Use these links to rapidly review the documentTABLE OF CONTENTS
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrantý | ||
Filed by a Party other than the Registranto | ||
Check the appropriate box: | ||
o | Preliminary Proxy Statement | |
o | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |
ý | Definitive Proxy Statement | |
o | Definitive Additional Materials | |
o | Soliciting Material under §240.14a-12 |
Ameriprise Financial, Inc. | ||||
(Name of Registrant as Specified In Its Charter) | ||||
(Name of Person(s) Filing Proxy Statement, if other than the Registrant) | ||||
Payment of Filing Fee (Check the appropriate box): | ||||
ý | No fee required. | |||
o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. | |||
(1) | Title of each class of securities to which transaction applies: | |||
(2) | Aggregate number of securities to which transaction applies: | |||
(3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): | |||
(4) | Proposed maximum aggregate value of transaction: | |||
(5) | Total fee paid: | |||
o | Fee paid previously with preliminary materials. | |||
o | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. | |||
(1) | Amount Previously Paid: | |||
(2) | Form, Schedule or Registration Statement No.: | |||
(3) | Filing Party: | |||
(4) | Date Filed: |
Please join us for
our Annual Meeting
of Shareholders
April 26, 2017
March 17, 20142017
Dear Fellow Shareholders:
You are cordially invited to join us for our 2014 annual meeting2017 Annual Meeting of shareholders,Shareholders, which will be held on Wednesday, April 30, 2014,26, 2017, at 11:00 a.m., Central time at the Ameriprise Financial Center at 707 Second Avenue South in Minneapolis, Minnesota 55474. Holders of record of our common stock as of the close of business on March 4, 2014,February 28, 2017 are entitled to notice of and to vote at the 2014 annual meeting.
The Notice of Annual Meeting of Shareholders and the proxy statement that follow describe the business to be conducted at the meeting. We also will report on matters of current interest to our shareholders.
We hope you will be able to attend the meeting. However, evenEven if you plan to attend in person, please submit a proxy promptly to ensure that your shares are represented at the meeting. You may submit your proxy by telephone or by Internet as described in the following materials or, ifmaterials. If you request that proxy materials be mailed to you and you don't submit your proxy by completingtelephone or by Internet, you must complete and signingsign the proxy card enclosed with those materials and returningreturn it in the envelope provided. If you decide to change or revoke your proxy, you may do so by voting in person at the meeting or by submitting a timely later-dated proxy or a written revocation to our corporate secretary.
To be admitted to this year'sthe annual meeting as a shareholder, you must bring an admission ticket, as explained starting on page 9273 of the proxy statement.
We look forward to seeing you at the annual meeting and discussing the business of your Company with you.
Very truly yours,
JAMES M. CRACCHIOLO
Chairman and Chief Executive Officer
AMERIPRISE FINANCIAL, INC.Ameriprise Financial, Inc.
707 SECOND AVENUE SOUTHSecond Avenue SouthMINNEAPOLIS, MINNESOTAMinneapolis, Minnesota 55474
Notice of
Annual Meeting of Shareholders
Items of Business | ||||||||
Date | ||||||||
Wednesday April 11:00 a.m. Central time | To elect the nine directors named in the proxy statement | |||||||
| | | ||||||
Place | To approve the compensation of the named executive officers by a nonbinding advisory vote | |||||||
| | | | | ||||
Ameriprise Financial Center Market Garden — Skyway Level 707 Second Avenue South Minneapolis, Minnesota 55474 | ||||||||
To | ||||||||
| | | ||||||
Record Date | ||||||||
To ratify the Audit Committee's selection of PricewaterhouseCoopers LLP as the Company's independent registered public | ||||||||
| | | | | ||||
You can vote if you are a shareholder of record as of the close of business on February 28, 2017. | ||||||||
To transact such other business that may properly come before the meeting or any adjournment of the | ||||||||
|
THOMAS R. MOORE | ||
Vice President, Corporate Secretary and Chief Governance Officer |
March 17, 20142017
Table of
Contents
| 1 | |
| 1 | |
Record Date | 1 | |
Ownership of Shares | 1 | |
How to Vote | 2 | |
Shares Held Under | 3 | |
Confidential Voting | 3 | |
| 3 | |
| ||
Routine and Non-Routine Proposals | 4 | |
How We Count Votes | 4 | |
Multiple Shareholders Sharing the Same Address | 4 | |
Cost of Proxy Solicitation | ||
| 5 | |
Requests for Copies of Materials | 5 | |
Director Independence | 5 | |
Independence of Committee Members | 5 | |
Categorical Standards of Director Independence | ||
Committee Charters | 6 | |
Internal Audit Function | 6 | |
Audit Committee Financial Experts | 6 | |
Executive Sessions of Independent Directors | ||
Presiding Director | ||
Communications from Shareholders and Other Interested Parties | ||
Our Board's Leadership Structure | ||
Our Board's Role in Risk Oversight | 7 | |
Our Board's Role in Strategic Planning | 8 | |
Consideration of Director Candidates Recommended | ||
Annual Performance Evaluation Process for the Board and | ||
Corporate Governance Guidelines | 9 | |
Codes of Conduct | 9 | |
Director Attendance at Annual Meeting of Shareholders | 9 | |
Majority Voting | ||
Director Qualifications and Board Policies | ||
Board Diversity | ||
Communicating | ||
Board and Committee Meetings | 11 | |
Membership on Board Committees | ||
Compensation and Benefits Committee | 12 | |
Compensation Committee Interlocks and Insider Participation | ||
Nominating and Governance Committee | ||
Director Nomination Process | ||
Audit Committee | 14 | |
Report of the Audit Committee | 16 | |
| 17 | |
| 18 | |
|
Items to Be Voted On By Shareholders | 24 | |||
| ||||
| 24 | |||
| Approve the Compensation of the Named Executive Officers by a Nonbinding Advisory Vote |
| 30 | |||
| Approve a Nonbinding Advisory Vote on the Frequency of Shareholder Approval of the Compensation of the Named Executive Officers | 31 | ||
| Ratification of the Audit Committee's Selection of PricewaterhouseCoopers LLP as the Company's Independent Registered Public Accounting Firm for 2017 | 32 | ||
Compensation of Executive Officers
| ||||
Compensation Discussion and Analysis | 34 | |||
| ||||
| ||||
Compensation and Benefits Committee Report | ||||
| ||||
| ||||
The Corporate Governance Framework of Our Executive Compensation Program | ||||
The Role of the Compensation and Benefits Committee | 36 | |||
Our Executive Compensation Philosophy & Process | 37 | |||
Compensation for the Named Executive Officers Based on 2016 Performance | 38 | |||
Summary of Total Direct Compensation for Our Named Executive Officers | 48 | |||
Additional Information about Our Executive Compensation Program | 49 | |||
Market Compensation Data | 49 | |||
Risk and Incentive Compensation | 50 | |||
| 51 | |||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
Stock Option, Restricted Stock, and Performance Share Unit Grant Practices and Procedures | ||||
Stock Ownership and Retention Guidelines | ||||
Post-Employment Compensation and Benefits | ||||
The Committee's Consideration of the | ||||
Summary Compensation Table | 54 | |||
| ||||
| ||||
Outstanding Equity Awards at Fiscal Year-End | ||||
Option Exercises and Stock Vested | ||||
Non-Qualified Deferred Compensation for | ||||
Pension Benefits in | ||||
Potential Payments | ||||
Certain Transactions | 71 | |||
| ||||
Related Person Transaction Review Policy | ||||
Transactions | ||||
Transactions | ||||
Transactions with Significant Shareholders | ||||
| ||||
Requirements, Including Deadlines, For Submission of Proxy Proposals, Nomination of Directors and Other Business by Shareholders
| ||||
| ||||
| ||||
|
Proxy Corporate Governance Highlights
Since we became a public company in 2005, our Board and its Nominating and Governance Committee have focused on corporate governance issues of interest to our shareholders.
Summary of Voting Matters and Board Recommendations
Item | | Board's Voting Recommendation | Page | |||
| | | | | | |
To elect the nine directors named in the proxy statement • Mr. Williams is standing for election for the first time since being appointed as a director effective as of September 6, 2016 | For | 24 | ||||
| | | ||||
To approve the compensation of the named executive officers by a nonbinding advisory vote • Only independent directors serve on the Compensation and Benefits Committee • The committee has retained the firm of Frederic W. Cook & Co., Inc. as its independent compensation consultant and confirms FW Cook's independence from management and reviews its performance annually | For | 30 | ||||
| | | ||||
To approve a nonbinding advisory vote on the frequency of shareholder approval of the compensation of the named executive officers • At our 2011 annual meeting, our shareholders voted to hold an annual nonbinding advisory vote to approve the compensation of the named executive officers • The Board is again recommending that our shareholders vote in favor of an annual nonbinding advisory vote to approve the compensation of the named executive officers | 1 year | 31 | ||||
| | | ||||
To ratify the Audit Committee's selection of PricewaterhouseCoopers LLP as the Company's independent registered public accounting firm for 2017 • Only independent directors serve on the Audit Committee • PricewaterhouseCoopers LLC has served continuously as the Company's external auditor since fiscal year 2011 | For | 32 | ||||
| | | | | | |
Our Board recommends a "For" vote on each of the proposals and for a "1 Year" vote on Item 3 to be presented at this year's annual meeting of shareholders | ||||||
| | | | | | |
i
Name | Age | Director Since | Current Occupation | Independent | Audit | Compensation and Benefits | Executive | Nominating and Governance | ||||||||
| | | | | | | | | | | | | | | | |
James M. Cracchiolo | 58 | 2005 | Chairman and Chief Executive Officer Ameriprise Financial, Inc. | | C | |||||||||||
| | | | | | | | | ||||||||
Dianne Neal Blixt | 57 | 2014 | Former Executive Vice President and Chief Financial Officer Reynolds American Inc. | ✓ | M | | ||||||||||
| | | | | | | | | ||||||||
Amy DiGeso | 64 | 2014 | Former Executive Vice President, Global Human Resources The Esteé Lauder Companies Inc. | ✓ | | M | | M | ||||||||
| | | | | | | | | ||||||||
Lon R. Greenberg | 66 | 2011 | Chairman Emeritus and Former Chairman and Chief Executive Officer UGI Corporation | ✓ | M | M | | |||||||||
| | | | | | | | | ||||||||
Siri S. Marshall | 68 | 2005 | Former Senior Vice President and General Counsel General Mills, Inc. | ✓ | | M | | M | ||||||||
| | | | | | | | | ||||||||
Jeffrey Noddle | 70 | 2005 | Former Chairman SUPERVALU INC. | ✓ | | C | M | M | ||||||||
| | | | | | | | | ||||||||
H. Jay Sarles | 72 | 2005 | Private Investor and Former Vice Chairman Bank of America | ✓ | C | M | M | |||||||||
| | | | | | | | | ||||||||
Robert F. Sharpe, Jr. | 65 | 2005 | Former President of Commercial Foods and Chief Administrative Officer ConAgra Foods, Inc. | ✓ | | M | M | C | ||||||||
| | | | | | | | | ||||||||
Christopher J. Williams | 59 | 2016 | Chairman, Chief Executive Officer and Founder The Williams Capital Group, L.P. | ✓ | M | | ||||||||||
| | | | | | | | | | | | | | | | |
C = Chairman
M = Member
ii
We are providing these proxy materials to you in connection with the solicitation of proxies by the Board of Directors of Ameriprise Financial, Inc. for the 20142017 annual meeting of shareholders and for any adjournment or postponement of the meeting. In this proxy statement, we may also refer to Ameriprise Financial, Inc. as "Ameriprise Financial," "Ameriprise," "the Company," "we," "our" or "us."
We are holding the 20142017 annual meeting at 11:00 a.m. Central time, on Wednesday, April 30, 2014,26, 2017, at the Company's Minneapolis headquarters and invite you to attend in person. An admission ticket is required for the annual meeting. Please see additional information about how to attend the meeting starting on page 92.73. If you need special assistance at the meeting because of a disability, you may contact Thomas R. Moore, our Vice President, Corporate Secretary and Chief Governance Officer, by telephone at (612) 678-0106, by email atthomas.r.moore@ampf.com or by writing to him at 1098 Ameriprise Financial Center, Minneapolis, MN 55474. We have arranged for a live audio webcast of the 20142017 annual meeting to be accessible to the general public on the Internet atir.ameriprise.com.
Under rules adopted by the Securities and Exchange Commission, weWe provide our shareholders with the choice of accessing the 20142017 annual meeting proxy materials over the Internet, rather than receiving printed copies of those materials through the mail. In connection with this process, a Notice Regarding the Availability of Proxy Materials is being mailed to our shareholders who have not previously requested electronic access to our proxy materials or paper proxy materials. The notice contains instructions on how you may access and review our proxy materials on the Internet and how you may submit a proxy for your shares over the Internet. The notice will also tell you how to request our proxy materials in printed form or by email, at no charge. The notice contains a 12-digit control number that you will need to votesubmit a proxy for your shares. Please keep the notice for your reference through the meeting date.
We anticipate that the Notice Regarding the Availability of Proxy Materials will be mailed to shareholders beginning on or about March 19, 2014.17, 2017.
You may vote all shares that you owned as of March 4, 2014,February 28, 2017, which is the record date for the annual meeting. On March 4, 2014,February 28, 2017, we had 190,594,540153,863,728 common shares outstanding at the close of business. Each common share is entitled to one vote on each matter properly brought before the meeting.
You may own common shares in one of the following ways:
If your shares are registered directly in your name, you are the holder of record of these shares and we are sending a Notice Regarding the Availability of Proxy Materials directly to you. As the holder of record, you have the right to submit your proxy, by telephone, by the Internet or by mail (if you request to receive your proxy materials by mail), or to vote in person at the meeting. If you hold your shares in street name, your broker, bank, trustee, or other holder of record is sending a Notice Regarding the Availability of Proxy Materials to you. As a holder in street name, you have the right to direct your broker,
bank or other holder of record how to vote by submitting voting instructions in the manner directed by your bank, broker, trustee, or other holder of record.
Regardless of how you hold your shares, we invite you to attend the annual meeting. To attend the meeting, you must have been a shareholder at the close of business on the record date of March 4, 2014,February 28, 2017, and you will need to bring an admission ticket. If you are a shareholder who plans to send a proxy or qualified representative to
represent you at the annual meeting, it is also important to note that under our amended and restated By-Laws, the following provisions apply: (i) no later than five business days prior to the annual meeting, a shareholder who has proposed business or made a nomination in accordance with the amended and restated By-Laws for consideration at the annual meeting must provide the full name(s) and current residential address of any person(s) authorized to act as a proxy or qualified representative for such shareholder in order for such qualified representative to gain admission to the annual meeting;meeting to present the proposed business or nomination on such shareholder's behalf; and (ii) no more than three persons who are authorized to act as proxy or a qualified representative for a shareholder may attend the annual meeting. You should review Article I, Section 1.10(c) of our By-Laws for additional information. We have posted our amended and restated By-Laws on our website on the Corporate Governance page atir.ameriprise.com.
The Notice Regarding the Availability of Proxy Materials that most of our shareholders will receive will have information about submitting your proxy online but is not permitted to include a telephonic voting number because that would enable a shareholder to vote without accessing the proxy materials online. The telephonic voting number will be on the website where the proxy materials can be found. For more information about submitting your proxy by telephone, please see the next two sections.
Your Vote is Important. We encourage you to submit your proxy promptly. Internet and telephone proxy submission is available through 10:00 a.m.11:59 p.m. Eastern time on Sunday, April 27, 2014,23, 2017, for shares held in the Ameriprise 401(k) plan and through 11:59 p.m. Eastern time on Tuesday, April 29, 2014,25, 2017, for all other shares. You may submit your proxy or vote in one of the following ways:
Revocation of Proxies. You can revoke your proxy at any time before your shares are voted if you:
Shares Held Under the Ameriprise Financial 401(k) Plan
If you participate in the Ameriprise Financial 401(k) Plan and invest in the Ameriprise Financial, Inc. Stock Fund, your proxy card includes shares that the plan has credited to your account. To allow sufficient time for the plan trustee to vote, the trustee must receive your voting instructions by 10:00 a.m.11:59 p.m. Eastern time, on Sunday, April 27, 2014.23, 2017. If the plan trustee does not receive your instructions by that date, the trustee will vote your shares in the same proportion of votes that the trustee receives from other plan participants who did vote.
We maintain the confidentiality of the votes of individual shareholders. We do not disclose these votes to any member of management unless we must disclose them for legal reasons or in the event of a contested proxy solicitation. However, if a shareholder writes a comment on the proxy card, we will forward the comment to management. In reviewing the comment, management may learn how the shareholder voted. In addition, the Inspector of Elections and selected employees of our independent tabulating agent may have access to individual votes in the normal course of counting and verifying the vote.
Quorum. We will have a quorum and will be able to conduct the business of the annual meeting if the holders of a majority of the voting power of the shares entitled to vote at the meeting, either in person or by proxy.
Votes Required for Proposals | How We Count Votes | |||||||||||||
| | | | | | | | | | | ||||
Item | To elect directors and adopt the other proposals, the following proportion of votes is required: | Routine/ Non-Routine | ||||||||||||
Treatment of Abstentions | Broker Non-Votes | |||||||||||||
| | | | | ||||||||||
To elect | named in the proxy statement | Under the majority voting standard, in an uncontested election, a nominee must receive a number of "For" votes that exceeds 50% of the votes cast (excluding abstentions)* | ||||||||||||
Non-routine | No effect; not included in numerator or denominator. | |||||||||||||
| | | | | ||||||||||
by a nonbinding advisory vote | The affirmative vote of a majority of the votes cast | |||||||||||||
Non-routine | No effect; not included in numerator or denominator. | |||||||||||||
| | | | | ||||||||||
To | ||||||||||||||
named executive officers | The affirmative vote of a majority of the votes cast | |||||||||||||
Non-routine | No effect; not included in numerator or denominator. | |||||||||||||
| | | | | ||||||||||
To ratify the Audit Committee's selection of PricewaterhouseCoopers LLP as the Company's independent registered public | 2017 | The affirmative vote of a majority of the votes cast | ||||||||||||
Routine | Broker non-votes do not occur with respect to routine matters. | |||||||||||||
| | | | | | | | | | | ||||
| | | | | | | | | | |
Quorum. We will have a quorum and will be able to conduct the business of the annual meeting if the holders of a majority of the voting power of the shares entitled to vote at the meeting are either present in person or represented by proxy at the meeting.
Routine and Non-Routine Proposals. The rules of the New York Stock Exchange determine whether proposals presented at shareholder meetings are routine or non-routine. If a proposal is routine, a broker or other entity holding shares for an owner in street name may vote on the proposal without receiving voting instructions from the owner under certain circumstances. If a proposal is non-routine, the broker or other entity may vote on the proposal only if the owner has provided voting instructions. A broker non-vote occurs when the broker or other entity is unable to vote on a proposal because the proposal is non-routine and the owner does not provide any voting instructions.
The rules of the New York Stock Exchange make all of the proposals to be considered at the annual meeting non-routine items (other thanexcept for the proposal to ratify the Audit Committee's selection of PricewaterhouseCoopers LLP as the Company's independent registered public accountantsaccounting firm for 2014).2017. This means that brokers who do not receive voting instructions from their clients as to how to vote their shares for these proposalsItems (1), (2) and (3) can't exercise discretion to vote their clients' shares. Therefore, it is important that you instruct your broker as to how you wish to have your shares voted on these proposals, even if you wish to vote as recommended by the Board of Directors.
How We Count Votes. In determining whether we have a quorum for the annual meeting, we count abstentions and broker non-votes as present and entitled to vote. For your convenience, we have provided thisthe chart on the previous page to show whether each item being voted on is routine or non-routine under the rules of the New York Stock Exchange. The chart also shows how abstentions and broker non-votes will be treated in determining the outcome of voting on each item.
Multiple Shareholders Sharing the Same Address
For those shareholders requesting paper proxy materials who share a single address and would like to receive only one annual report and proxy statement at that address, please contact our corporate secretary. This service, known as "householding," is designed to reduce our printing and postage costs. If after signing up for householding any shareholder residing at such an address wishes to receive a separate annual report or proxy statement in the future, he or she may contact our corporate secretary. The contact information for our corporate secretary is provided on page one under "General Information."
We will pay the expenses of soliciting proxies. Our directors, officers or employees may solicit proxies for us in person, or by telephone, facsimile or electronic transmission for no additional compensation. We have hired D.F. King & Co., Inc. to help us distribute and solicit proxies. We will pay D.F. King $19,000$20,000 plus expenses for these services.
This section highlights our corporate governance program. We provide details about these and other corporate governance policies and practices in other sections of the proxy statement and on our website on the Corporate Governance page atir.ameriprise.com.
Requests for Copies of Materials
You may request copies of any of the documents referred to in this section of the proxy statement by calling Thomas R. Moore, our Vice President, Corporate Secretary and Chief Governance Officer, at (612) 678-0106. You may also write to him by email atthomas.r.moore@ampf.com or by mail at 1098 Ameriprise Financial Center, Minneapolis, MN 55474. We'll provide the copies at no cost to you.
Our Board, acting upon the recommendation of its Nominating and Governance Committee, has affirmatively determined that the following directors have no material relationship with the Company and are therefore independent under the corporate governance listing standards of the New York Stock Exchange: Mses.Dianne Neal Blixt, Amy DiGeso, Lon R. Greenberg, Siri S. Marshall, Jeffrey Noddle, H. Jay Sarles, Robert F. Sharpe, Jr. and Marshall and Messrs. Greenberg, Lewis, Noddle, Sarles, Sharpe, and Turner.
Before determining that Mr. Sarles is independent, the Board broadly considered all facts and circumstances relevant to his brother-in-law's employment as a financial advisor of Ameriprise Financial, which began in April 2012. The Board's independent Nominating and Governance Committee first reviewed Mr. Sarles' continued independence at its meeting on July 11, 2012, and again reviewed it at a meeting held on February 25, 2014, and voted to recommend that the Board reaffirm its prior determination that Mr. Sarles is independent, which the Board did. Mr. Sarles recused himself from voting on this matter at both meetings. Before the Board voted with respect to Mr. Sarles' independence on February 25, 2014, he confirmed that there have been no changes in the facts and circumstances of his brother-in-law's employment that would affect his continued independence. In arriving at this determination, the Board and its Nominating and Governance Committee relied on due diligence performed by management that revealed the following: Mr. Sarles did not exert any influence with respect to the hiring of his brother-in-law; the normal interview and employment practices were followed; Mr. Sarles' brother-in-law has a long history of employment in the financial services industry and was considered highly qualified by those who interviewed him; and Mr. Sarles' brother-in-law is financially independent of Mr. Sarles and there is no financial obligation or other arrangement between them.Christopher J. Williams.
Our only non-independent director and the only Company officer serving on the Board is Mr. Cracchiolo, our chairman and chief executive officer and the only Company officer serving on the Board.officer.
Independence of Committee Members
As required by the rules of the New York Stock Exchange, only independent directors serve on these standing committees of the Board: Audit; Compensation and Benefits; and Nominating and Governance. Members of the Audit Committee also meet the independence standards of Rule 10A-3 of the Securities Exchange Act of 1934, as amended. Members of the Compensation and Benefits Committee also meet the independence standards for "outside directors" under Section 162(m) of the Internal Revenue Code
of 1986, as amended, and are considered "non-employee directors" under Rule 16b-3 of the Securities Exchange Act of 1934, as amended.
On the Board's Executive Committee, Mr. Cracchiolo serves as the committee's chairman and the chairmen of the three other standing committees serve as the Executive Committee's other members. The corporate governance rules of the New York Stock Exchange do not require that all members of the Executive Committee be independent directors.
Categorical Standards of Director Independence
Upon the recommendation of its Nominating and Governance Committee, the Board has approved categorical standards of director independence. These categorical standards: assist the Board in making its independence determinations; provide investors with an adequate means of assessing the quality of the Board's independence; and avoid the excessive disclosure of immaterial relationships. The Board's categorical standards of independence are posted on our website on the Corporate Governance page atir.ameriprise.com. The categorical standards generally classify as "not material": relationships with our Company arising in the ordinary course of business; relationships with companies of which a director is a shareholder or partnerships of which a director is a partner; contributions made or pledged to charitable organizations with which a director has a relationship; certain familial relationships; and certain social and other relationships. In addition to the New York Stock Exchange's standard independence tests, the Nominating and Governance Committee applied the categorical standards of independence when making its recommendations regarding director independence to the Board of Directors. In making these independence recommendations, the Nominating and Governance Committee considered all relationships and transactions between the director and the Company as described in questionnaires completed by each director and in materials provided by management, which may include transactions discussed in this proxy statement and relationships not considered material under the categorical standards of independence approved by the Board.
The Board's Audit, Compensation and Benefits, and Nominating and Governance Committees each operate under a written charter that is approved by the Board of Directors. Each committee charter satisfies the requirements of the New York Stock Exchange's corporate governance listing standards. Each committee reviews and reassesses the adequacy of its charter at least annually. Each committee will recommend any proposed changes to the Board of Directors for consideration and approval. The committee charters are posted on our website on the Corporate Governance page atir.ameriprise.com and additional information about each committee is contained in the sections following this summary.
The Executive Committee also operates under a written charter that is approved by the Board of Directors. The Executive Committee's charter is posted on our website at the same location as the other committee charters.
The Company has an internal audit function that is supervised by our general auditor. The Audit Committee reviews the appointment and replacement of the general auditor. The Audit Committee also annually reviews the performance and compensation of the general auditor. The general auditor reports regularly to the Audit Committee, including in executive sessions where he is the only officer present.
Audit Committee Financial Experts
The Board of Directors has determined that William H. Turner, the chairman of the Audit Committee,Ms. Blixt and H. JayMessrs. Greenberg and Sarles a member of the Audit Committee, are "audit committee financial experts" as that term is defined by the regulations of the Securities and Exchange Commission or SEC. The Board has also
determinedregulations and that Messrs. Sarles and Turner are financially literate andthey have accounting or related financial management expertise, as those qualifications arethe Board interpreted by the Boardsuch qualification in its business judgment. The Board has also determined that each otherall Audit Committee member ismembers are financially literate, as that term is interpreted by the Board in its business judgment.
Executive Sessions of Independent Directors
The independent directors customarily meet in executive session without management present at each regularly scheduled meeting of the Board. The Board may decide, however, that such an executive session is not required at a particular Board meeting.
The Company's Corporate Governance Guidelines provide that the then serving chairman of the Nominating and Governance Committee shall act as the Board's presiding director, with the following duties: preside over executive sessions of the non-management and independent directors; serve as the principal liaison between the Board and the Company's chairman and chief executive officer on sensitive issues; and preside at meetings of the Board of Directors in the event of the chairman's unavailability.
Mr. Sharpe currently serves as the Board's presiding director.
Communications from Shareholders and Other Interested Parties
Shareholders and other interested parties may make their concerns known to the independent directors by communicating directly with the presiding director or another director via the Company's corporate secretary. You can find more information about how to communicate with our independent directors on page 1110 of this proxy statement, under the caption "Communicating with Directors."
Our Board's Leadership Structure
Our Board of Directors determines which leadership structure best serves its needs and those of our shareholders. Currently, Mr. Cracchiolo serves as both the chairman of the Board of Directors and the chief executive officer of the Company. Mr. Sharpe, the chairman of the Board's Nominating and Governance Committee, currently serves as the Board's presiding director.
The Board believes that Mr. Cracchiolo's service as both chairman and chief executive officer has the following advantages for the Company given the
specific characteristics or circumstances of the Company. Mr. Cracchiolo provides proven leadership ability, strong communication skills, and a deep understanding of the Company, the financial services industry, and the Company's long-term strategic direction. The chairman is often required to speak on behalf of the entire Board to shareholders, regulators, and other stakeholders and therefore must engender the trust and respect of the entire Board. As the leader of the Board, Mr. Cracchiolo must also be able to maintain an atmosphere of collegiality, encourage open and vigorous discussion and debate during Board meetings, and promote fairness in considering the views and opinions of all directors.
Recognizing that the Company's or the Board's circumstances may change, the Board has no policy with respect to the separation of the officesroles of the chairman and chief executive officer. As stated in our Corporate Governance Guidelines, "The Board believes that this issue is part of the succession planning process, which is overseen by the Compensation and Benefits Committee, and that it is in the best interests of the Company to make a determination when it elects a new chief executive officer."
The Board believesrecognizes that Mr. Cracchiolo's service as both chairmanthe Company's and chief executive officer hasBoard's circumstances may change in the following advantages for the Company given the specific characteristics or circumstancescontext of the Company: the preparation for Board meetings, particularly the formatCEO succession planning and content of Board presentations, is very efficient; there is a single source of leadership and authority for the Board; there is no need to incur additional costs by providingthat having a separate chairman with administrative support and increased compensation; and Mr. Cracchiolo's intimate knowledge ofCEO is an option that the Company's strategy and day-to-day operations allows him to coordinate Board communications and actions quickly.will consider carefully in those circumstances.
The role of the Board's presiding director is an important part of the Board's leadership structure. At other companies, this role may be called a "lead director." Our Corporate Governance Guidelines assign the following duties to the presiding director: preside over executive sessions of non-management and independent directors; serve as principal liaison between the Board'sBoard and the chairman and chief executive officer on sensitive issues; and preside at meetings of the Board of Directors in the event of the chairman's unavailability.
In addition to the presiding director, our Board has adopted a number of procedures and policies designed to preserve the effectiveness of the independent directors and the transparency of Board operations. For example, each Board agenda includes an executive session of the independent directors, although those directors may decide that one is not needed. Any director is free to suggest agenda items, to request additional time for an agenda topic, or to request information from management. The independent directors also have regular access to members of management other than the chief executive officer. In advance of each regular Board meeting, the corporate secretary asks the independent directors to submit any questions or topics that they would like the chairman and chief executive officer to address at the meeting.
Our Board's Role in Risk Oversight
It is the job of our chief executive officer, chief financial officer, general counsel, and other members of our senior management to identify, assess, and manage our exposure to risk. Our Board plays an important role in overseeing management's performance of these functions. The Board of Directors has approved the charter of its Audit Committee, and that charterwhich lists the primary responsibilities of the Audit Committee. Those responsibilities require the Audit Committee to discuss with management, the general auditor, and the independent auditors the Company's enterprise-wide risk assessment and risk management processes, including major risk exposures, risk mitigants, and the design and effectiveness of the Company's processes and controls to prevent and detect fraudulent activity. Some aspect of risk management and oversight is discussed at virtually every Audit Committee meeting. The Audit Committee's charter is posted on our website on the Corporate Governance page atir.ameriprise.com.
As a diversified financial services company, our business is subject to a number of risks and uncertainties, which are described in detail in our Form 10-K for the year ended December 31, 2013,2016, which is included as part of our 20132016 Annual Report to Shareholders. The Audit Committee and the Board as a whole receive regular reports from management and our independent auditors on prevailing material risks and the actions being taken to mitigate them. Management also reports to the Audit Committee and the Board on steps being taken to enhance our risk management processes and controls in light of evolving market, business, regulatory, and other conditions. Because four of our nineeight independent directors serve on the Audit Committee, a significant portion of the independent directors is closely and regularly involved in the risk oversight function.
Directors who do not serve on the Audit Committee have access to the Committee's meeting materials,
including draft minutes for each Audit Committee meeting. The chairman of the Audit Committee reports to the entire Board on the Audit Committee's activities and decisions. In addition, each presentation to the Audit Committee or the Board on any significant matter is preceded by an executive summary that includes a section devoted to risk management issues. This section is intended to focus the attention of the Audit Committee and the Board on key risk topics and management's related risk management strategies and processes. As part of its ongoing responsibilities, the Audit Committee reviews and assesses the quality and clarity of the risk management information provided to it and, if necessary, makes recommendations to management for improving this information reporting.
Because we are in a highly regulated industry, the Audit Committee and the Board receive regular reports of examination from our regulators. In part, these reports address risk management topics and, as needed, the Audit Committee and the Board will respond in writing to risk management or other issues raised in the reports. In order to confirm that it is receiving candid and complete information on risk management and other topics, the Audit Committee holds regular separate executive sessions with members of executive management, our independent auditors, and our general auditor.
In response to emerging best practices and regulatory guidelines, the Audit Committee and the Compensation and Benefits Committee have received reports on risks related to our incentive
compensation plans across the Company. The committees will continue to receive such reports as needed. These plans cover officers and employees who are not executive officers. We discuss this subject in more detail in the section of the Compensation Discussion and Analysis captioned "Risk and Incentive Compensation" beginning on page 66.50.
In the preceding section of the proxy statement, we explained our Board's leadership structure. Our chairman and chief executive officer is ultimately responsible for the effectiveness of the Company's risk management processes and is an integral part of our day-to-day risk management processes. He also attends each Audit Committee meeting, except in extraordinary circumstances unrelated to that meeting's agenda. As a result, his ability to lead our enterprise risk management program and to assist in the Board's oversight of that program improves the effectiveness of both the Board's leadership structure and its oversight of risk.
Our Board's Role in Strategic Planning
Ameriprise has a strategic Long-Range Plan that guides how we lead the Company to maximize long-term shareholder value creation, deliver competitively differentiated value to our clients, and attract and retain talent. Each year, our executive team revisits and updates that plan as appropriate to address changes in the external and competitive environment, as well as internal capabilities. Our Board of Directors plays an important role in our strategic planning process as well. Each year, we hold detailed discussions with the Board on the Long-Range Plan at our annual long-range planning offsite meeting, as well as throughout the year as appropriate.
In addition, the Long-Range Plan guides the development of our annual operating plan and budgets. Throughout the year, management and the Board hold regular discussion on the business performance and progress on the annual plan and what we are looking to accomplish in the context of our Long-Range Plan. Corporate and individual performance goals and metrics are defined and used to inform and determine executive long-term incentive awards by the Compensation and Benefits Committee, as explained in detail beginning on page 38 of this proxy statement.
Consideration of Director Candidates Recommended by Shareholders
The Nominating and Governance Committee will consider director candidates recommended by shareholders, provided that the requirements explained on page 1514 under the caption "Director Nomination Process" are satisfied.
Annual Performance Evaluation Process for the Board and its Committees
The Nominating and Governance Committee oversees an annual performance evaluation process for the Board of Directors and the Audit, Compensation and Benefits, and Nominating and Governance Committees. The process is intended to determine whether the Board and its committees are functioning effectively.
Corporate Governance Guidelines
The Board of Directors has approved Corporate Governance Guidelines. Among other topics, the Corporate Governance Guidelines address: director qualification standards; director responsibilities; director access to management and, as necessary and appropriate, independent advisors; director compensation; director orientation and continuing education; management succession; and the annual performance evaluation of the Board and its committees. The Corporate Governance Guidelines are posted on our website on the Corporate Governance page atir.ameriprise.com.
We have adopted a Global Code of Conduct to guide ethical business behavior and decision-making. The Code applies to all of our officers, employees, financial advisors, and their employees, and individuals conducting business on behalf of us and our subsidiaries. Following our Global Code of Conduct and all applicable laws, regulations, and Company policies is a condition of employment or association with the Company.Company, except as otherwise provided by the laws of a foreign jurisdiction.
The Board of Directors has adopted a Code of Business Conduct for Members of the Board of Directors of Ameriprise Financial, Inc. This Code is intended to focus each director on areas of potential conflicts of interest and provide guidance relating to the recognition and handling of ethical issues. The Code also provides mechanisms to report potential conflicts of interest or unethical conduct and is intended to help to foster a culture of openness and accountability.
Both of these Codes are posted on our website on the Corporate Governance page atir.ameriprise.com.
Director Attendance at Annual Meeting of Shareholders
Our Corporate Governance Guidelines state that directors are expected to attend the annual meeting of shareholders. The corporate secretary reminds each director of this policy in writing in advance of each annual meeting of shareholders. At our 20132016 annual meeting of shareholders, all directors then serving were in attendance.
Tableattendance, with the exception of ContentsMr. Turner, who was not standing for re-election.
Our By-Laws provide for majority voting for directors in uncontested elections. The plurality standard will be used in the case of contested elections. We anticipate that the election of directors to be held at the meeting will be uncontested, and therefore the majority voting standard will apply. We have provided additional information about the By-Law provisions governing majority voting for directors beginning on page three of this proxy statement, underin the captiontable titled "Votes Required for Proposals."
Director Qualifications and Board Policies
The Board of Directors has determined that directors should be persons who have achieved prominence in their field and who possess significant experience in areas of importance to the Company, such as general management, finance, marketing, technology, law, business or public sector activities.
Directors should possess integrity, energy, forthrightness, analytical skills and the commitment to devote the necessary time and attention to the Company's affairs. Directors should possess a willingness to challenge and stimulate management and the ability to work as part of a team in an environment of trust.
The Nominating and Governance Committee will consider whether the candidate has served as the chief executive officer, chief financial officer or other executive officer of a public company with significant policy-making or operational responsibility. The Committee also evaluates a candidate's manifest potential to significantly enhance the effectiveness of the Board and its committees. Experience in an area that is directly relevant to one or more of our business segments is also an important consideration.
The committee considers these specific qualities or skills as being necessary for one or more directors to possess:
Independent directors have access to individual members of management or to our employees on a confidential basis. Directors are authorized to conduct independent investigations and to hire outside consultants or experts at our expense. Directors also have access to our records and files, and directors may contact other directors without informing our management of the purpose or even the fact of such contact.
We believe that each director should have a substantial personal investment in the Company. A personal holding of Company shares or deferred share units having a market value of five times the amount of the current annual cash retainerupon attainment is recommended for each director. A decrease in the price of a share of our common stock after a director has attained the required ownership threshold will not negate the director's satisfaction of this requirement. Directors are expected to attain this ownership threshold within five years of joining the Board. We disclose the dollar value of each outside director's equity holdings as of March 4, 2014,February 28, 2017, on page 23.22. All directors who have served on the Board for more than five years are in compliance with our ownership threshold.
Our Board of Directors does not have a formal written policy with regard to the consideration of diversity in identifying director nominees. Our Corporate Governance Guidelines, however, require the Board's Nominating and Governance Committee to review the qualifications of the directors and the composition of the Board as a whole periodically. This assessment includes not only the independence of the directors, but also consideration of required minimum qualifications, diversity, age, skills, and experience in the context of the needs of the Board. Our Corporate Governance Guidelines provide that the Board will establish the number of directors based on the recommendations of its Nominating and Governance Committee, which will consider, among other factors: the Board's current and anticipated need for directors with specific qualities, skills, experience or backgrounds; the availability of highly qualified candidates; committee workloads and membership needs; and anticipated director retirements.
Whenever the Nominating and Governance Committee engages a search firm to identify potential director candidates, the committee instructs the firm that diversity considerations are highly important. Similarly, whenever the committee considers candidates identified by other directors or shareholders, the same considerations apply. Because our Board of Directors is relatively small, it may not always be possible to recruit a director who has the skills and experience needed by the Board at that time and who also enhances the diversity of the Board. Nevertheless, considerations of gender, racial, and ethnic diversity will continue to be important factors in identifying and recruiting new directors. The Board of Directors believes that maintaining and enhancing the Board's diversity are important corporate governance goals.
The Board of Directors has provided a means by which shareholders or other interested parties may send communications to the Board or to individual members of the Board. Such communications, whether by letter, email or telephone, should be directed to the Company's corporate secretary, who will forward them to the intended recipients. However, unsolicited advertisements or invitations to conferences or promotional material, in the discretion of the Company's corporate secretary, may not be forwarded to the directors.
If a shareholder or other interested party wishes to communicate a concern to the chairman of the Audit Committee about our financial statements, accounting practices, internal controls or business ethics or corporate conduct, the concern should be submitted in writing to the chairman of the Audit Committee in care of our corporate secretary. If the concern relates to our executive compensation program, the concern should be submitted in writing to the chairman of the Compensation and Benefits
Committee in care of our corporate secretary. If the concern relates to our governance practices, the concern should be submitted in writing to the chairman of the Nominating and Governance Committee in care of our corporate secretary. If the shareholder or other interested party is unsure as to which category his or her concern relates, he or she may communicate it to any one of the independent directors in care of our corporate secretary. The contact information for the Company's corporate secretary is provided on page one under "General Information".Information."
Our "whistleblower" policy prohibits us or any of our employees from retaliating or taking any adverse action against anyone for raising a compliance or ethical concern in good faith. If a shareholder, employee or other interested party nonetheless prefers to raise his or her concern in a confidential or anonymous manner, the concern may be directed to our ethics hotline, at (800) 963-6395. This is a confidential, independent service that allows individuals to report compliance or ethical issues and concerns they may have concerning Ameriprise Financial. An ethics specialist will forward accounting and auditing issues to our general auditor and our general counsel, who will confirm that the matter is properly investigated and, if deemed appropriate, report the results to the Audit Committee.
During 2013,2016, the Board of Directors met seveneight times. All of our directors attended 89%86% or more of the meetings of the Board and Board committees on which they served in 2013.
Table of Contents2016.
Membership on Board Committees
This table lists our four standing Board committees, the directors who currently serve on them, and the number of committee meetings held in 2013. The Board of Directors plans to appoint Mses. Blixt and DiGeso to one or more committees at its organization meeting on April 30, 2014, following the adjournment of the annual meeting of shareholders.2016.
Audit | Audit | | Compensation and Benefits | | Executive | | Nominating and Governance | Compensation and Benefits | Executive | Nominating and Governance | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | |||||||||||||||||||
Mr. Sarles(1) | Mr. Noddle(2) | Mr. Cracchiolo(2) | Mr. Sharpe(3) | ||||||||||||||||||||
| | ||||||||||||||||||||||
Ms. Blixt(4) | Ms. DiGeso | Mr. Noddle | Ms. DiGeso | ||||||||||||||||||||
| | ||||||||||||||||||||||
Mr. Greenberg(4) | Mr. Greenberg | Mr. Sarles | Ms. Marshall | ||||||||||||||||||||
| | ||||||||||||||||||||||
Mr. Williams(5) | Ms. Marshall | Mr. Sharpe | Mr. Noddle | ||||||||||||||||||||
| | ||||||||||||||||||||||
Mr. Turner(1) | Mr.Noddle(2) | Mr.Cracchiolo(2) | Mr. Sharpe(3) | Mr. Sharpe | Mr. Sarles | ||||||||||||||||||
Mr. Greenberg | Mr.Greenberg | Mr. Noddle | Mr.Lewis | ||||||||||||||||||||
Mr. Sarles(4) | Mr.Lewis | Mr.Sharpe | Ms.Marshall | ||||||||||||||||||||
Mr. Sharpe | Ms.Marshall | Mr.Turner | Mr.Noddle | ||||||||||||||||||||
Mr.Sharpe | Mr.Sarles | ||||||||||||||||||||||
Number of meetings held in 2013 | |||||||||||||||||||||||
13 | 7 | 0 | 3 | ||||||||||||||||||||
| | | | | | ||||||||||||||||||
Number of meetings held in 2016 | Number of meetings held in 2016 | ||||||||||||||||||||||
| | | | | | ||||||||||||||||||
11 | 7 | 1 | 2 | ||||||||||||||||||||
| | | | |
Compensation and Benefits Committee
Under its written charter, the Compensation and Benefits Committee's primary purposes are to: establish the philosophy and objectives that will govern our compensation and benefits programs; oversee and approve the compensation and benefits paid to our chief executive officer and other executive officers; recommend tofor approval by the Board for approval executiveof Directors or the shareholders incentive and otherequity-based compensation and benefits plans and arrangements;plans; and promote the clear and complete disclosure to shareholders of material information regarding the compensation and benefits of our chief executive officer, chief financial officer, and our highest paid executive officers. A copy of the committee's charter is posted on our website on the Corporate Governance page atir.ameriprise.com.
The committee is also responsible for oversight of the incentive compensation plans throughout the Company, to the extent and in the manner set forth in relevant regulatory guidance or rules and for recommendations to the Board on matters related to nonbinding advisory votes of shareholders to approve the compensation of the named executive officers, submitted as Item 2 of this proxy statement, and the frequency of those votes.votes, submitted as Item 3 of this proxy statement.
Among other matters, the committee exercises ultimate authority with respect to: the compensation and benefits of our chief executive officer and other executive officers; the approval of grants and awards of equity-based and other incentive awards to our chief executive officer and other executive officers and to employees below the executive officer level; and the engagement, oversight, compensation, and termination of the committee's compensation consultant.
While the Compensation and Benefits Committee oversees our executive compensation program, the Nominating and Governance Committee has the authority to oversee the compensation and benefits of non-management directors and make recommendations on such matters to the Board of Directors for approval. We provide information about the compensation of our outside directors beginning on page 18.17.
The Compensation and Benefits Committee has the authority under its charter to: retain independent legal or other advisors; ask us to provide the committee with the support of one or more of our officers or employees to assist it in carrying out its duties; and request any of our officers or employees or those
of our outside counsel or independent auditors to attend a meeting of the committee or to meet with any members of, or consultants to, the committee.
The committee has the authority to determine the appropriate amount of funding to be provided by us for the payment of the compensation of any compensation consultant or other advisor engaged by the committee and for the payment of any administrative expenses of the committee that are necessary or appropriate in carrying out its duties.
The committee has the authority to delegate its authority to one or more subcommittees, including to the committee chairman, who may act on behalf of the committee during the intervals between meetings.
Depending on the nature of the authority being delegated, a subcommittee may have to consist of a minimum of two members due to certain federal securities and tax law requirements.
The committee may also delegate its authority to one or more of our officers or employees to the extent permitted by federal securities and income tax laws, Delaware law, the rules of the New York Stock Exchange or theapplicable governing compensation plan document.documents.
The committee has delegated certain administrative authority to our chief human resources officer to promote the efficient and timely administration of our compensation and benefits plans.
The Role of Executive Officers. Our executive officers play the following roles in recommending the amount or form of executive compensation: preparing committee meeting materials related to the performance of the committee's duties, including total compensation tally sheets and other summaries of executive officers' total compensation; proposing the adoption of new or amended compensation or benefits plans; the chief executive officer will make recommendations to the committee for consideration regarding compensation actions for executive officers other than himself; our chief human resources officer will discuss survey and benchmarking data related to executive compensation and other topics of interest to the committee; and our chief financial officer will discuss and explain the setting and calculation of financial performance goals for certain executive
compensation plans. No executive officer has the authority to approve his or her compensation or to make equity-based grants to himself or herself, or to any other executive officer.
The Committee's Independent Compensation Consultant. The Compensation and Benefits Committee currently uses the firm of Frederic W. Cook & Co., Inc. ("FW Cook") as its independent compensation consultant. In 2013, theThe committee adoptedmaintains a new Compensation Adviser Policy, to replace its previous Compensation Consultant Policy. The policywhich addresses the following topics: the relationship between the committee and its compensation advisers; the criteria that the committee uses to select its consultant; the consultant's duties; how the committee evaluates its compensation consultant; the factors that the committee will apply in determining whether its consultant is independent of the Company's management; and the related disclosure to be provided to our shareholders. We have posted the committee's Compensation Adviser Policy on our website on the Corporate Governance page atir.ameriprise.com. You can request a copy of the Compensation Adviser Policy by writing to Thomas R. Moore, Vice President, Corporate Secretary and Chief Governance Officer, 1098 Ameriprise Financial Center, Minneapolis, MN 55474. You may also email him atthomas.r.moore@ampf.com. He will send you a copy of the policy without charge.
Under the committee's charter, the engagement letter between FW Cook and the committee, and the Compensation Adviser Policy, the committee is responsible for the appointment, oversight, amount of compensation, evaluation, retention, and termination of its compensation consultant. FW Cook works for and reports directly to the committee, not the Company's management, with respect to executive compensation matters. The committee recognizes that its consultant will necessarily work with representatives of management on executive compensation and other matters within the scope of the
committee's responsibilities. When doing so, however, FW Cook will act as the committee's representative and solely on the committee's behalf.
In its capacity as the committee's consultant, FW Cook provided the following services, among others: advice and guidance with respect to trends and issues related to executive compensation; assisting the committee in benchmarking competitive compensation, including the composition of a peer group to be used as a market check or reference point in reviewing proxy compensation data; assisting the committee in developing an executive compensation philosophy and program suited to our business strategy and goals; and preparing reports and analyses for the committee's meeting materials. One or more representatives of FW Cook attend committee meetings as needed.
At a committee meeting held on February 25, 2014,23, 2017, the committee confirmed that FW Cook continues to be independent of the Company's management, in light of the five independence standards established in the committee's Compensation Adviser Policy. The lead representative of Cook assigned to the committee engagement represented in writing to the committee that Cook satisfies all five of the independence standards: Cook did not provide the Company with any products and services unrelated to the consultant's engagement with the committee; all products and services provided by Cook to the committee have been provided in the ordinary course of business and on substantially the same terms and conditions, including fees and charges, as would be available to similarly situated parties; Cook has not provided products or services to any executive officer of Ameriprise Financial as an individual client of the firm; the firm's representatives assigned to the engagement are not an "immediate family member", as defined in the policy, of any committee member or any executive officer of Ameriprise Financial; and the firm's representatives are not former employees of Ameriprise Financial or any of its affiliates.
In addition, beforeBefore reaffirming FW Cook's continued independence the committee considered any other factors it deemed relevant and the following six specific factors contained in a new Securities and Exchange Commission rule and the related New York Stock Exchange corporate governance listing standards that became effective on July 1, 2013, and Cook's responses in a letter addressed to Mr. Noddle as the committee chairman, together with other factors the committee deemed relevant:standards: the provision of other services to Ameriprise by FW Cook; the amount of fees received during 20132016 from Ameriprise by FW Cook as a percentage of FW Cook's 20132016 total revenue; FW Cook's policies and procedures designed to prevent conflicts of interest; any business or personal relationship between a member of the FW Cook engagement team with a member of the committee; any Ameriprise Financial stock owned by FW Cook or by any member of the Ameriprise consulting team or their immediate family members; and any business or personal relationship of FW Cook or any other employee of FW Cook with an executive officer of Ameriprise Financial. Cook's responses with respect to the final four factors were qualified by the terms "to the best of our knowledge" or "to our knowledge." Based on this review and FW Cook's responses, the committee determined that no conflict of interest exists that would preclude FW Cook from independently representing the committee.
At its meeting held on February 25, 2014,23, 2017, the committee also reviewed and discussed FW Cook's performance in executive session, without representatives of FW Cook present.
Finally, the Committee reviewed written independence statements submitted by threetwo law firms retained by management with respect to matters considered by the committee.
Reporting to the Board. The committee chairman reports to the entire Board regarding each committee meeting. When appropriate these reports and related discussion are conducted in executive session, without management present. Before the committee takes final action with respect to compensation actions affecting the chief executive officer, it first
discusses its proposed actions with the other independent directors, without management present.
Management discusses the proposed agenda for each committee meeting with the committee chairman in advance and it is reviewed with the other committee members in advance as well. The committee has
adopted a policy of including an executive session on the agenda of each committee meeting. The committee members may decide, however, that an executive session is unnecessary at a particular meeting. This executive session is held without management present. The committee chairman has the authority to add or delete items from any proposed agenda, and to call special meetings of the committee at any time.
Compensation Committee Interlocks and Insider Participation. The Compensation and Benefits Committee members include Amy DiGeso, Lon R. Greenberg, W. Walker Lewis, Siri S. Marshall, Jeffrey Noddle, chairman, and Robert F. Sharpe, Jr. None of the members is a former or current officer or employee of the Company or any of its subsidiaries, or is an executive officer of another company where an executive officer of Ameriprise Financial is a director.
Nominating and Governance Committee
The Nominating and Governance Committee operates under a written charter that is posted on our website on the Corporate Governance page atir.ameriprise.com. The committee's purposes are to: assume a leadership role in shaping the corporate governance of the Company; promote the effective functioning of the Board and its committees; advance the best interests of the Company and its shareholders through the implementation, oversight, and disclosure of sound corporate governance guidelines and practices; periodically review the compensation of outside directors and recommend changes to the Board for approval; and promote the clear and complete disclosure to shareholders of material information regarding the compensation and benefits of the Company's outside directors.
InSince 2011, the committee amended itscommittee's charter, with the Board's approval, to includehas included oversight responsibility for corporate political spending. Based on the committee's recommendation, the Board also approved a Statement of Principles Governing Corporate Political Spending, which is posted on our website on the Corporate Governance page atir.ameriprise.com, to govern those contributions and expenditures, if any, made at the direction of the Company's officers with corporate funds. TheEach year, the Company will postposts an annual corporate political spending report on its website.
The committee has adopted a policy of including an executive session attended by committee members only on the agenda of each committee meeting. The committee members may decide, however, that an executive session is unnecessary at a particular meeting.
Director Nomination Process. The Nominating and Governance Committee considers and recommends candidates for election or appointment to the Board. The committee also considers candidates for election to the Board submitted by shareholders. Each member of the committee participates in the review and discussion of director candidates. In addition, members of the Board of Directors who are not on the committee may meet with and evaluate the suitability of candidates. In making its selections of candidates to recommend for election or appointment, the committee will apply the standards and criteria set forth under the caption "Director Qualifications and Board Policies" beginning on page 109 of this proxy statement. The committee applies the same standards in considering candidates submitted by shareholders as it does in evaluating candidates submitted by members of the Board of Directors.
Shareholders who wish to submit nominees for election at an annual or special meeting of shareholders must follow the procedures described on page 90.73. Shareholders who wish to submit a candidate for consideration by the Nominating and Governance Committee may do so by sending the candidate's name and supporting information to Thomas R. Moore, Vice President, Corporate Secretary and Chief Governance Officer, at the address shown on page one under "General Information."
The responsibilities of the Audit Committee are described in its written charter and in the following required Audit Committee Report. A copy of the committee's charter is posted on our website on the Corporate Governance page atir.ameriprise.com. The committee's purposes are to provide assistance to
the Board of Directors by: monitoring the integrity of the consolidated financial statements of the Company; monitoring compliance by the Company with legal and regulatory requirements and the Company's Code of Conduct; evaluating and monitoring the independent auditors' qualifications and independence; evaluating and monitoring the performance of the Company's internal audit function and independent auditors, with respect to the parent company and its subsidiaries; and addressing the finance and risk management matters specified in its charter.
The committee has adopted a policy of including executive sessions on the agenda of each committee meeting. Such executive sessions may include committee members only, or may include separate executive sessions between the committee members and the general auditor, representatives of our independent auditors, or representatives of management, including our chief executive officer, chief financial officer, and general counsel. The committee members may decide, however, that executive sessions are not required at a particular meeting.
Audit Committee Financial Experts. The Board has determined that Mr. TurnerMs. Blixt and Mr.Messrs. Greenberg and Sarles are "audit committee financial experts" as defined by the Securities and Exchange Commission regulations and that they have accounting or related financial management expertise, as the Board interpreted such qualification in its business judgment. The Board has also determined that each Audit Committee member is financially literate, as that term is interpreted by the Board in its business judgment.
External Auditors. The Board of Director's Audit Committee is directly responsible for the appointment, compensation, retention and oversight of the independent external audit firm retained to audit the Company's financial statements. The Audit Committee has appointed PricewaterhouseCoopers LLC as the Company's independent external auditor for fiscal year 2017. PricewaterhouseCoopers LLC has been retained as the Company's external auditor continuously beginning with our 2011 fiscal year. The Audit Committee is responsible for the audit fee negotiations associated with the Company's retention of PricewaterhouseCoopers.
In order to assure continuing auditor independence, the Audit Committee periodically considers whether there should be a regular rotation of the independent external audit firm. In conjunction with the mandated rotation of PricewaterhouseCoopers LLC's lead engagement partner, the Audit Committee and its chairperson are directly involved in the selection of the new lead engagement partner. The members of the Audit Committee and the Board believe that the continued retention of PricewaterhouseCoopers LLC to serve as the Company's independent external auditor is in the best interests of the Company and its shareholders.
The Audit Committee's job is one of oversight as set forth in its charter. It is not the duty of the Audit Committee to prepare the Company's consolidated financial statements, to plan or conduct audits or investigations, or to determine that the Company's financial statements are complete and accurate and are in accordance with generally accepted accounting principles. The Company's management is responsible for preparing the Company's consolidated financial statements and for establishing and maintaining effective internal control over financial reporting. The Company's management is also responsible for its assessment of the effectiveness of internal control over financial reporting. The independent registered public accountants areaccounting firm is responsible for the audit of the Company's consolidated financial statements and the audit of the effectiveness of the Company's internal control over financial reporting. In addition, the independent registered public accountants areaccounting firm is responsible for the audit of management's assessment of the effectiveness of internal control over financial reporting.
In the performance of its oversight function, the Audit Committee has reviewed and discussed with management and the independent registered public accountantsaccounting firm the Company's audited financial statements. The Audit Committee also has discussed with the independent registered public accountantsaccounting firm the matters required to be discussed by Auditing Standard No. 16 as amended, relating to communication with audit committees.under the applicable rules and standards of the Public Company Accounting Oversight Board. In addition, the Audit Committee has received the written disclosures and the letter from its independent accountantaccounting firm required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountants'accounting firm's communications with the Audit Committee concerning independence and has discussed with the independent accountantsaccounting firm its independence.
The Audit Committee discussed with the Company's general auditor and independent registered public accountantsaccounting firm the overall scope and plans for their respective audits. The Audit Committee meets with the general auditor and independent registered public accountants,accounting firm, with and without management present, to discuss the results of their examinations, their evaluations of the Company's internal controls and the overall quality of the Company's financial reporting. In addition, the Audit Committee meets with the chief executive officer and chief financial officer of the Company to discuss the Company's control environment and the overall quality of the Company's financial reporting.
In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board of Directors, and the Board has approved, that the Company's audited financial statements be included in the Company's 20132016 Annual Report to Shareholders and, for filing with the Securities and Exchange Commission, the Company's Annual Report on Form 10-K for the year ended December 31, 2013.2016.
MEMBERS OF THE AUDIT COMMITTEE:William H. Turner, ChairmanLon R. GreenbergH. Jay SarlesRobert F. Sharpe, Jr.
MEMBERS OF THE AUDIT COMMITTEE: H. Jay Sarles, Chairman Dianne Neal Blixt Lon R. Greenberg Christopher J. Williams |
Our compensation philosophy for outside directors. We compete with other companies for executive talent, as we explain in the Compensation Discussion and Analysis later in this proxy statement. We must also compete with them for persons with the ability, integrity, experience, and judgment required to serve on the board of a public company. We need to attract and retain directors who meet the high qualification standards set by our Board of Directors. In order to do so, we must offer a compensation package that is both competitive and fair in view of the significant time commitment and responsibilities that come with a director's job. Only outside directors receive compensation for serving on our Board. Mr. Cracchiolo does not receive any additional compensation for his service as a director.
We believe that our outside directors should have a substantial personal financial stake in the Company. Accordingly, a significant portion of our directors' compensation package is equity-based. Also, a director is expected to have an equity holding in the Company with a market value of five times the amount of the current annual cash retainer upon attainment. The current annual cash retainer for the directors is $80,000.was increased from $80,000 to $100,000 effective as of January 1, 2017. A decrease in the price of a share of our common stock after a director has attained the required ownership threshold will not negate the director's satisfaction of this requirement. A director mustis expected to reach this goal within five years of joining our Board. Shares of our common stock and deferred share units both count toward this goal. Using a closing price of $110.28$131.50 for a share of our common stock on March 4, 2014,February 28, 2017, the value of the common stock and deferred share units beneficially held by our outside directors on that date was as follows, rounded to the nearest dollar: Mses. Blixt ($22,056)626,729), DiGeso ($22,056)522,187) and Marshall ($2,400,354)3,536,430); and Messrs. Greenberg $1,103,021; Lewis ($2,173,067)2,354,639); Noddle ($3,931,151)5,495,385); Sarles ($3,559,287)4,713,223); Sharpe ($7,375,968)8,241,105); and TurnerWilliams ($2,796,260)166,348). As is true for our executive officers, we prohibit our directors from hedging against a decline in the value of our stock.
How and why our outside directors' compensation was determined. The Board's Nominating and Governance Committee is responsible under its charter for overseeing the compensation and benefits paid to our outside directors. The committee will periodically review the appropriateness of the outside directors' compensation package.
The committee will discuss with an independent consultant any proposed changes to the compensation of outside directors. The committee will then recommend to the Board that it approve such changes as the committee believes are reasonable and appropriate, based in part on the consultant's report and findings. If the Board approves the committee's recommendations, and, as it relates to equity-based compensation, if the committee's recommendations are within the shareholder-approved limitation on director compensation under our Amended and Restated 2005 Incentive Compensation Plan, the new compensation package will become effective as of a date set by the Board.
There were no changes to the outside directors' compensation program for 2013. In 2013,At its meeting held on October 5, 2016, the Nominating and Governance Committee engaged Frederic W.reviewed and discussed an analysis of non-management director compensation prepared by FW Cook, & Co., Inc.,which also serves as its independentthe compensation consultant to review the outside directors'Compensation and Benefits Committee. FW Cook also submitted information to the committee to assist it in confirming that FW Cook is independent from the Company and the non-management directors serving on the committee and the other non-management directors serving on the Board.
Among other matters, FW Cook's report: reviewed the design and competitiveness of our non-management director compensation program; compared the program to the 16-company peer group that is also used in connection with our executive compensation program; and recommended changes to the amount of certain components of the program. Based on this reviewAlthough FW Cook concluded that the program's core design is aligned with our peer group and analysis,general market best practices, it found that increases in the annual Board approvedcash retainer, the following change, based on a recommendation by itsannual Board equity award, and the chairmen's annual cash retainers for the Compensation and Benefits Committee and Nominating and Governance Committee:Committee were appropriate in order to align compensation with peer group competitive levels. FW Cook noted that those competitive levels had increased significantly since it presented its last report on our non-management director compensation program to the dollar amount ofcommittee in 2013. Acting in reliance on FW Cook's report, the annual grant of deferred share units was increased from $115,000 to $125,000, effective for the plan year beginning April 30, 2014.
Thiscommittee recommended that the Board approve the changes to the program that are detailed in the following paragraph.
Changes to the outside directors' compensation program, beginning effective January 1, 2017. At its meeting held on October 5, 2016, the Board, acting upon the recommendation of its Nominating and Governance Committee, approved the following changes to be effective as of January 1, 2017: the dollar amount of the annual director cash retainer, paid quarterly, is increased from $80,000 to $100,000; and the dollar amount of the annual retainer for the chairmen of both the Nominating and Governance Committee and Compensation and Benefits Committee is increased from $15,000 to $20,000. The Board also approved an increase in the dollar amount of the annual grant in the form of Deferred Share Units from $125,000 to $150,000 effective for the plan year beginning on the date of the Company's 2017 annual meeting of shareholders. In all other respects the Company's compensation program for non-management directors remains in full force and effect.
The chart below summarizes the current compensation program for our outside directors.directors during 2016. We do not pay meeting fees or grant stock options or restricted stock to our outside directors.
Outside Directors Compensation Program for | |||||
| | | |||
Annual Cash Retainer | $80,000 | ||||
| |||||
Annual Equity Retainer | $ | ||||
| |||||
Board Meeting Fees | No board meeting fees | ||||
| |||||
Committee Meeting Fees | No committee meeting fees | ||||
| |||||
Committee Member Annual Retainer | Committee members receive an annual retainer as follows: | ||||
• Audit Committee — | |||||
• Compensation and Benefits Committee — | |||||
• Nominating and Governance Committee — | |||||
There is no committee member retainer for the members of the Executive Committee. | |||||
| |||||
Committee Chairman Annual Retainer | Committee chairmen receive an annual retainerin addition to the committee member retainer, as follows: | ||||
• Audit Committee chairman — | |||||
• Compensation and Benefits Committee chairman — $15,000 ($25,000 total committee retainer) | |||||
• Nominating and Governance Committee chairman — $15,000 ($25,000 total committee retainer) | |||||
| |||||
Charitable Matching Gift Program | Up to $2,000 annually | ||||
| | |
Perquisites and Personal Benefits. Our outside directors receive occasional perquisites or personal benefits of reasonable value, such as: commemorative items in connection with their Board service; welcoming gifts at the hotel where they stay during Board meetings or events; holiday gifts; and recreational or other services and amenities when attending an off-site Board long-range planning meeting. We do not provide our directors with a tax gross-up amount on any gifts or other items given to them.
We pay for or reimburse our outside directors for their reasonable travel, lodging, food and other expenses related to their attendance at Board, committee or annual shareholder meetings. Our outside directors may use our corporate aircraft for Board-related travel, subject to the aircraft's availability and other restrictions. In extraordinary or unusual circumstances, such as a family emergency, we may make our corporate aircraft available to our outside directors on an exception basis.
Our outside directors are eligible to participate in our charitable gift matching program on the same basis as our employees. We will match a director's personal contributions to one or more qualifying charitable organizations subject to an annual aggregate limit, which is currently $2,000.$1,500. The annual aggregate limit was reduced from $2,000 to $1,500 for gifts made on or after January 1, 2017. The $2,000 limit applied to gifts made during 2016. Directors' requests for matching gifts are processed by the
same outside vendor that we use for employee matching gift requests.
Other Assistance and Payments. As is true at many other public companies, our in-house counsel and other employees, as well as outside counsel, assist our outside directors in satisfying their legal reporting obligations under Section 16(a) of the Securities Exchange Act of 1934, as amended. We pay for the fees and expenses related to the preparation and filing of Securities and Exchange Commission Forms 3, 4 and 5 for our outside directors, but only for transactions in our equity securities.
A director's Section 16(a) reporting obligations for transactions in our equity securities are imposed solely due to his or her service on our Board. Therefore, we do not consider such assistance and related payments to be perquisites or personal benefits. Nevertheless, we have provided this information to you in the interests of full and transparent disclosure.
Compensation Paid to Outside Directors in 20132016
This table shows the total compensation earned by or paid to our outside directors during 2013. Mses. Blixt and DiGeso were appointed directors effective as of February 26, 2014.2016. The table also discloses other payments, such as deemed dividends on deferred share units and the amount of charitable matching gifts we made, if any, for a director.
Name | Annual Retainer Earned or Paid in Cash | Committee Chairman Retainer Earned or Paid in Cash | Committee Member Retainer Earned or Paid in Cash | Stock Awards(1) | All Other Compensation(2) | Total | Annual Retainer Earned or Paid in Cash | Committee Chairman Retainer Earned or Paid in Cash | Committee Member Retainer Earned or Paid in Cash | Stock Awards(1) | All Other Compensation(3) | Total | ||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
Dianne Neal Blixt | $ | 80,000 | $ | 0 | $ | 15,000 | $ | 125,000 | $ | 9,921 | $ | 229,921 | ||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Amy DiGeso | $ | 80,000 | $ | 0 | $ | 20,000 | $ | 125,000 | $ | 11,921 | $ | 236,921 | ||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Lon R. Greenberg | $ | 80,000 | $ | $ | 25,000 | $ | 115,000 | $ | 10,930 | $ | 230,930 | $ | 80,000 | $ | 0 | $ | 25,000 | $ | 125,000 | $ | 29,432 | $ | 259,432 | |||||||||||||||
Warren D. Knowlton* | 80,000 | 25,000 | 115,000 | 44,917 | 264,917 | |||||||||||||||||||||||||||||||||
W. Walker Lewis | 80,000 | 20,000 | 115,000 | 41,245 | 256,245 | |||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Siri S. Marshall | 80,000 | 4,739 | (3) | 20,000 | 115,000 | 41,245 | 260,984 | $ | 80,000 | $ | 0 | $ | 20,000 | $ | 125,000 | $ | 76,458 | $ | 301,458 | |||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Jeffrey Noddle | 80,000 | 15,000 | 20,000 | 115,000 | 68,635 | 298,635 | $ | 80,000 | $ | 15,000 | $ | 20,000 | $ | 125,000 | $ | 118,947 | $ | 358,947 | ||||||||||||||||||||
H. Jay Sarles | 80,000 | 25,000 | 115,000 | 41,245 | 261,245 | |||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
H. Jay Sarles(2) | $ | 80,000 | $ | 20,000 | $ | 25,000 | $ | 125,000 | $ | 75,723 | $ | 325,723 | ||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Robert F. Sharpe, Jr. | 80,000 | 10,261 | (4) | 35,000 | 115,000 | 59,929 | 300,190 | $ | 80,000 | $ | 15,000 | $ | 20,000 | $ | 125,000 | $ | 87,715 | $ | 327,715 | |||||||||||||||||||
William H. Turner | 80,000 | 40,000 | 15,000 | 115,000 | 41,245 | 291,245 | ||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
William H. Turner* | $ | 25,934 | $ | 0 | $ | 11,346 | $ | 0 | $ | 53,042 | $ | 90,322 | ||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Christopher J. Williams**(2) | $ | 25,435 | $ | 0 | $ | 3,587 | $ | 79,452 | $ | 668 | $ | 109,142 | ||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | |
For your convenience, we'vewe have broken out the two components of "All Other Compensation" in the chart below. Dollar amounts in each component have been rounded to the nearest dollar.
| Deemed Dividends | Charitable Matching Gifts | Deemed Dividends | Charitable Matching Gifts | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | | | | |||||||
Dianne Neal Blixt | $ | 9,921 | $ | 0 | ||||||||||
| | | ||||||||||||
Amy DiGeso | $ | 9,921 | $ | 2,000 | ||||||||||
| | | ||||||||||||
Lon R. Greenberg | $ | 10,930 | $ | 0 | $ | 27,432 | $ | 2,000 | ||||||
Warren D. Knowlton | 44,917 | 0 | ||||||||||||
W. Walker Lewis | 41,245 | 0 | ||||||||||||
| | | ||||||||||||
Siri S. Marshall | 41,245 | 0 | $ | 74,458 | $ | 2,000 | ||||||||
| | | ||||||||||||
Jeffrey Noddle | 68,635 | 0 | $ | 116,947 | $ | 2,000 | ||||||||
| | | ||||||||||||
H. Jay Sarles | 41,245 | 0 | $ | 75,723 | $ | 0 | ||||||||
| | | ||||||||||||
Robert F. Sharpe, Jr. | 59,929 | 0 | $ | 85,715 | $ | 2,000 | ||||||||
| | | ||||||||||||
William H. Turner | 41,245 | 0 | $ | 53,042 | $ | 0 | ||||||||
| | | ||||||||||||
Christopher J. Williams | $ | 668 | $ | 0 | ||||||||||
| | | | | | | |
Deferred Share Plan for Outside Directors. All of our outside directors participate in the Ameriprise Financial Deferred Share Plan for Outside Directors. Each outside director receives an annual grant of deferred share units immediately following the annual meeting of shareholders. A deferred share unit is a phantom share of our common stock that tracks the value of our common stock. A deferred share unit receives deemed dividends in the same amount paid on a share of our common stock, but it has no
voting rights. Outside directors may also choose to defer part or all of their annual cash retainer and any committee retainer under the plan.
Deferred share units issued to outside directors in 2013.2016. This table shows the number of deferred share units issued to outside directors during 2013.2016. In order to simplify the presentation, we have rounded the numbers shown to the nearest unit. During 2013, directors'Directors' accounts were credited with deemed dividends on the deferred share units at the same rate as the dividends paid on a share of our common stock. These deemed dividends were reinvested in additional deferred share units.
| DSU Balances as of December 31, 2012 | DSUs Credited During 2013 | DSU Balances as of December 31, 2013 | DSU Balances as of December 31, 2015 | DSUs Credited During 2016 | DSU Balances as of December 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||||||||||||
| Annual Equity Grant | Retainer Deferral | Total DSUs† | Annual Equity Grant | Reinvested Deemed Dividends | Retainer Deferral | Total DSUs | Annual Equity Grant | Retainer Deferral | Total DSUs†† | Annual Equity Grant | Retainer Deferral | Total DSUs† | Annual Equity Grant | Reinvested Deemed Dividends | Retainer Deferral | Total DSUs | Annual Equity Grant | Retainer Deferral | Total DSUs† | ||||||||||||||||||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||||||||||||||
Dianne Neal Blixt | 2,408 | 0 | 2,408 | 1,237 | 100 | 0 | 1,337 | 3,745 | 0 | 3,745 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amy DiGeso | 2,408 | 0 | 2,408 | 1,237 | 100 | 0 | 1,337 | 3,745 | 0 | 3,745 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lon R. Greenberg | 4,145 | 4,145 | 1,601 | 127 | 1,728 | 5,873 | 5,873 | 8,334 | 0 | 8,334 | 1,237 | 278 | 0 | 1,515 | 9,849 | 0 | 9,849 | |||||||||||||||||||||||||||||||||||||||||||||
Warren D. Knowlton | 15,720 | 4,721 | 20,441 | 1,601 | 528 | 657 | 2,787 | 17,726 | 5,501 | 17,726 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
W. Walker Lewis | 19,078 | 19,078 | 1,601 | 486 | 2,087 | 21,165 | 21,165 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Siri S. Marshall | 19,078 | 19,078 | 1,601 | 486 | 2,087 | 21,165 | 21,165 | 24,249 | 0 | 24,249 | 1,237 | 758 | 0 | 1,995 | 26,244 | 0 | 26,244 | |||||||||||||||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Jeffrey Noddle | 19,078 | 13,492 | 32,570 | 1,601 | 809 | 2,410 | 21,165 | 13,816 | 34,981 | 24,249 | 14,379 | 38,628 | 1,237 | 1,191 | 0 | 2,428 | 26,244 | 14,812 | 41,056 | |||||||||||||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
H. Jay Sarles | 19,078 | 19,078 | 1,601 | 486 | 2,087 | 21,165 | 21,165 | 24,249 | 0 | 24,249 | 1,237 | 770 | 676 | 2,683 | 26,244 | 688 | 26,932 | |||||||||||||||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Robert F. Sharpe, Jr. | 19,078 | 9,203 | 28,281 | 1,601 | 706 | 2,307 | 21,165 | 9,424 | 30,589 | 24,249 | 3,809 | 28,058 | 1,237 | 872 | 0 | 2,109 | 26,244 | 3,924 | 30,168 | |||||||||||||||||||||||||||||||||||||||||||
William H. Turner | 19,078 | 19,078 | 1,601 | 486 | 2,087 | 21,165 | 21,165 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
William H. Turner* | 24,249 | 0 | 24,249 | 0 | 566 | 0 | 566 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Christopher J. Williams** | 0 | 0 | 0 | 890 | 6 | 0 | 896 | 896 | 0 | 896 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Outside Directors Deferred Share Plan for Outside Directors2016
| | | | | |||||
Amount | • $ • Outside directors whose first term is less than one year long will receive a pro-rata grant based on their length of service between their appointment to the Board and the next annual meeting of shareholders | • Before the beginning of each calendar year, a director may elect to defer up to 100% of the annual cash retainer and any committee chairman or member retainer, in 25% increments | |||||||
| |||||||||
Investment Options | • Only investment option is Ameriprise deferred share units, credited to a separate annual equity grant deferred share unit account | • Director may choose to invest deferred amounts in one or both of these options: Ameriprise deferred share units or a cash account that receives a market rate of interest, credited on the last day of each month | |||||||
| |||||||||
Number of Deferred Share Units Credited | • The number of deferred share units is determined by dividing the dollar amount awarded by the | • The number of units credited is determined by dividing the quarterly deferral amount by the | |||||||
| |||||||||
Dividend Equivalent Reinvestment | • Account is credited with additional deferred share units on each dividend payment date for our common stock |
| |||||||
• Number of additional units is calculated by first multiplying the number of units held on the dividend record date by the dividend payable on a share of our common stock; that number is then divided by the | • Deemed dividends on deferred share units are reinvested in the same manner used for the annual equity grant account | ||||||||
| |||||||||
Distribution | • Single payment in shares of our common stock following the director's end of service | • A director makes a distribution election at the same time he or she makes a deferral election, and that election applies to that year's deferrals. A director makes a new distribution election each year. A director has three distribution choices: | |||||||
• Lump sum on March 31 of a specified year | |||||||||
• Lump sum following the director's end of service | |||||||||
•
| |||||||||
| |||||||||
Change in Control | • Upon a change in control, the entire account will be immediately distributed in shares of our common stock | • Upon a change in control, all amounts held in either account will be immediately distributed | |||||||
| | | | |
Ownership of Our Common Shares
The table below shows how many Ameriprise common shares certain individuals and entities beneficially owned on March 4, 2014.February 28, 2017. These individuals and entities include: (1) owners of more than 5% of our outstanding common shares; (2) our current directors; (3) the five executive officers named in the compensation tables included in subsequent sections of this proxy statement; and (4) all current directors and executive officers as a group. A person has beneficial ownership over shares if the person has or shares voting or investment power over the shares or the right to acquire such power within 60 days of March 4, 2014.February 28, 2017. Investment power means the power to direct the sale or other disposition of the shares. Each person has sole voting and investment power over the shares, except as we describe below.
The column captioned "Deferred Share Units" shows DSUs owned by non-management directors through the Outside Directors Deferred Share Plan and phantom units owned by the executive officers under the Company's Supplemental Retirement Plan and Deferred Compensation Plan. The information in this column is not required by the rules of the Securities and Exchange Commission because these units carry no voting rights and will be settled in shares of common stock that the recipient does not have the right to acquire within 60 days of March 4, 2014.February 28, 2017. Nevertheless, we believe that this information provides a more complete picture of the financial stake that our directors and executive officers have in the Company.
Name | Number of Shares Owned(4)(5) | Right to Acquire(6) | Percent of Class | Deferred Share Units | | Number of Shares Owned(6)(7) | Right to Acquire(8) | | Percent of Class | Deferred Share Units | | ||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
FMR LLC | 11,172,798 | (1) | — | 5.9% | — | ||||||||||||||||||||||||
Wellington Management Company, LLP | 11,159,048 | (2) | — | 5.8% | — | ||||||||||||||||||||||||
| | | | | | | | | | ||||||||||||||||||||
The Vanguard Group | | 12,161,895 | (1) | — | | | 7.9 | % | | ��� | — | | | ||||||||||||||||
| | | | | | | |||||||||||||||||||||||
T. Rowe Price Associates, Inc. | | 11,599,185 | (2) | — | | | 7.5 | % | | | — | | | ||||||||||||||||
| | | | | | | |||||||||||||||||||||||
BlackRock, Inc. | 10,078,270 | (3) | — | 5.2% | — | | 10,760,324 | (3) | — | | | 7.0 | % | | | — | | | |||||||||||
| | | | | | | |||||||||||||||||||||||
Norges Bank | | 9,530,202 | (4) | — | | | 6.2 | % | | | — | | | ||||||||||||||||
| | | | | | | |||||||||||||||||||||||
State Street Corporation | | 8,435,811 | (5) | — | | | 5.5 | % | | | — | | | ||||||||||||||||
| | | | | | | | | | ||||||||||||||||||||
Dianne Neal Blixt | 200 | — | * | 0 | | 1,000 | | — | | | * | | | | 3,766 | | | ||||||||||||
| | | | | | | |||||||||||||||||||||||
Amy DiGeso | 200 | — | * | 0 | | 205 | | — | | | * | | | | 3,766 | | | ||||||||||||
| | | | | | | |||||||||||||||||||||||
Lon R. Greenberg | 4,100 | — | * | 5,902 | | 8,000 | | — | | | * | | | | 9,906 | | | ||||||||||||
W. Walker Lewis | 1,895 | — | * | 17,810 | |||||||||||||||||||||||||
| | | | | | | |||||||||||||||||||||||
Siri S. Marshall | 500 | — | * | 21,266 | | 500 | | — | | | * | | | | 26,393 | | | ||||||||||||
| | | | | | | |||||||||||||||||||||||
Jeffrey Noddle | 500 | — | * | 35,147 | | 500 | | — | | | * | | | | 41,290 | | | ||||||||||||
| | | | | | | |||||||||||||||||||||||
H. Jay Sarles | 11,009 | (7) | — | * | 21,266 | | 8,609 | (9) | — | | | * | | | | 27,233 | | | |||||||||||
| | | | | | | |||||||||||||||||||||||
Robert F. Sharpe, Jr. | 36,150 | (8) | — | * | 30,734 | | 32,330 | (10) | — | | | * | | | | 30,340 | | | |||||||||||
William H. Turner | 4,090 | (9) | — | * | 21,266 | ||||||||||||||||||||||||
| | | | | | | |||||||||||||||||||||||
Christopher J. Williams | | 200 | | — | | | * | | | | 1,065 | | | ||||||||||||||||
| | | | | | | | | | ||||||||||||||||||||
James M. Cracchiolo | 414,381 | 1,552,412 | 1.0% | 112,042 | | 285,229 | | 701,084 | | | * | | | | 132,516 | | | ||||||||||||
| | | | | | | |||||||||||||||||||||||
Walter S. Berman | 40,000 | 359,379 | * | 35,648 | | 12,153 | | 243,210 | | | * | | | | 40,754 | | | ||||||||||||
| | | | | | | |||||||||||||||||||||||
William F. Truscott | 73,606 | 341,769 | * | 6,419 | | 58,491 | | 228,878 | | | * | | | | 5,499 | | | ||||||||||||
Donald E. Froude | 27,593 | 174,028 | * | 28,562 | |||||||||||||||||||||||||
| | | | | | | |||||||||||||||||||||||
Colin Moore | 37,380 | 47,556 | * | 0 | | 75,547 | | 106,770 | | | * | | | | 0 | | | ||||||||||||
All current directors and executive officers | 840,221 | 3,007,489 | 2.0% | 372,123 | |||||||||||||||||||||||||
| | | | | | | |||||||||||||||||||||||
Joseph E. Sweeney | | 15,574 | | 99,076 | | | * | | | | 2,635 | | | ||||||||||||||||
| | | | | | | | | | ||||||||||||||||||||
All current directors and executive officers | | 599,998 | | 1,648,126 | | | 1.5 | % | | | 346,216 | | | ||||||||||||||||
| | | | | | | | | |
Our executive officers and directors are prohibited from hedging in any way against a decline in the value of the Ameriprise common stock they own. Executive officers are also prohibited from pledging their Ameriprise common stock in any manner, whether as collateral for a loan, in a margin account held at a broker, or otherwise. Our directors are permitted to pledge their Ameriprise common stock in this manner, provided that effective as of March 1, 2014, they first pre-clear the pledge with our corporate secretary or another Company lawyer. A pledge will not be approved if it is significant in relation to the average trading volume of our common stock for the five trading days immediately preceding the pre-clearance request.
The shares of common stock subject to a pledge will not be counted in determining the satisfaction of the equity ownership requirement then applicable to our outside directors.
Name | Number of Shares in Plan Accounts | ||||||||
---|---|---|---|---|---|---|---|---|---|
| | | | | |||||
James M. Cracchiolo | |||||||||
| | ||||||||
Walter S. Berman | |||||||||
| | ||||||||
William F. Truscott | |||||||||
| |||||||||
Colin Moore | 0 | ||||||||
| | ||||||||
Joseph E. Sweeney | 260 | ||||||||
| | | | | |||||
All executive officers, including those named above | |||||||||
| | | | |
Name | Number of Restricted Shares | ||||||||
---|---|---|---|---|---|---|---|---|---|
| | | | | |||||
James M. Cracchiolo | |||||||||
| | ||||||||
Walter S. Berman | |||||||||
| | ||||||||
William F. Truscott | |||||||||
| |||||||||
Colin Moore | |||||||||
| |||||||||
Joseph E. Sweeney | |||||||||
| | | | | |||||
All executive officers, including those named above | |||||||||
| | | | |
Items to Be Voted on by Shareholders
Item 1 — Election ofTo elect the Nine Directors Named Below
All of our directors are elected annually and the directors elected at this annual meeting will be elected for a one-year term ending at the 20152018 annual meeting.
Our Board of Directors has fixed the number of directors at ten.nine. At this year's annual meeting, the terms of all ten directors now serving will expire.
The Board has appointed Walter S. Berman, John C. Junek,Karen Wilson Thissen, and Thomas R. Moore as proxies who will vote your shares for which proxies have been submitted. Their names appear on the proxy card. Proxies will be voted "FOR" the election of each of the tennine nominees unless you indicate on the proxy card or voting instructions that you vote "AGAINST" or "ABSTAIN" from voting with respect to, any or all of the nominees. The telephone and Internet proxy submission procedures will include instructions on how to abstain from voting with respect to any or all nominees. We expect that each nominee will be able to serve if elected as a director. However, if any nominee is not able to serve, the persons named as proxies may vote for another person nominated by the Nominating and Governance Committee. Alternatively, the Board of Directors, at its option, may reduce the number of directors.
We currently expect that the election of directors will be uncontested and therefore the nominees for director will be subject to a majority voting standard, as explained in more detail on page three.
The Board of Directors recommends a vote "FOR" the election of the ten director nominees. Proxies will be voted "FOR" the election of all nominees unless otherwise specified.
The nominees for election as director and the directors whose terms of office will continue after the meeting have provided the following information about themselves.
The Securities and Exchange Commission's rules require us to discuss briefly the specific experience, qualifications, attributes or skills that led the Board to conclude that each director or nominee for director should serve on our Board of Directors. We've provided this discussion in a separate paragraph immediately belowalong with the biographical information provided by each director in the following section.
All of our directors possess the minimum qualities and skills described in the section of the proxy statement captioned "Director Qualifications and Board Policies", beginning on page 10.9. In addition, one or more of our directors possess the specific qualities or skills considered necessary by the Nominating and Governance Committee, also described in that section.
As you read the disclosures, please keep these points in mind. First, if a specific qualification, attribute or skill is ascribed to one or more directors, that does not necessarily imply that other directors do not possess that qualification, attribute or skill. Second, this disclosure does not impose on the director any duties, obligations or liability that are greater than the duties, obligations, and liability imposed on each member of the Board of Directors. Third, the disclosure does not affect the duties, obligations, or liability of any other member of the Board of Directors.
Because the discussion of the specific experience, qualifications, attributes or skills of a director is to be made each year in light of the Company's business and structure at that time, the content of this discussion may change for one or more directors in future years.
Ms. Blixt and Ms. DiGeso areMr. Williams is standing for election as directorsa director for the first time. The Board of Directors, acting upon the recommendation of its Nominating and Governance Committee, appointed themhim as directors at the Board meeting held on February 25, 2014,a director effective as of February 26, 2014. During the committee's regular review of Board composition and succession planning, aSeptember 6, 2016. A non-management director recommended Ms. Blixt to the committeeMr. Williams as a potential candidate and Mr. Cracchiolo, our chairman and chief executive officer, recommended Ms. DiGeso as part of a potential candidate. Over the course of several months prior to their appointment, both new directors met with the majority of our current directors,search being conducted by a consultant engaged by the Nominating and Governance Committee held a special meeting to discuss theirCommittee. The committee considered the qualifications and potential to enhance the effectiveness of the Boardpotential director candidates, including Mr. Williams, and its committees, and the committee directed thatafter conducting appropriate due diligence, be completed for both candidates. As a result, the Committee and the Board unanimously concluded that Ms. Blixt and Ms. DiGeso both have the integrity, independence of thought, work ethic, analytical skills and knowledge necessary to serve as directors of Ameriprise. We provide additional information about their experience, qualifications, attributes or skills below.
Directors — Nominees for Terms Ending In 2015
James M. Cracchiolo: Age 55, Chairman and Chief Executive Officer of the Company since September 30, 2005.appointed Mr. Cracchiolo has been chairman and chief executive officer of Ameriprise Financial, Inc. since September 30, 2005, when American Express Financial Corporation completed its spin-off from American Express Company. Prior to that, Mr. Cracchiolo was chairman and chief executive officer of American Express Financial Corporation since March 2001, president and chief executive officer of American Express Financial Corporation since November 2000, and group president, global financial services of American Express since June 2000. He served as chairman of American Express Bank Ltd. from September 2000 until April 2005 and served as president and chief executive officer of Travel Related Services International from May 1998 through July 2003. Mr. Cracchiolo joined AmericanWilliams.
The Board of Directors recommends a vote "FOR" the election of the nine director nominees. Proxies will be voted "FOR" each director nominee unless otherwise specified. |
Directors — Nominees for Terms Ending in 2018
James M. Cracchiolo |
Jim Cracchiolo has been Chairman and Chief Executive Officer of Ameriprise Financial since 2005, when the company, American Express in 1982. He is an advisorFinancial Advisors, completed its spin-off from the American Express Company. Mr. Cracchiolo guided Ameriprise through its first decade as a public company while generating strong shareholder value. Prior to his current role, Mr. Cracchiolo held a number of executive level positions at American Express, including leading businesses with significant domestic and global operations. Mr. Cracchiolo served as Group President American Express Global Financial Services from 2000-2005 and held the Marchfollowing roles: Chairman and CEO of DimesAmerican Express Financial Advisors; Chairman of American Express International Bank; and previously served on the boardCEO of Tech Data Corporation.Travel Related Services International. In addition, Mr. Cracchiolo was President and CEO of Travel Related Services International from 1998-2000; President of Global Network Services from 1997 to 1998; Senior Vice President of Travel Related Services Quality, Global Reengineering and Strategy from 1993-1997; and Executive Vice President and Chief Financial Officer of Shearson Lehman Brothers (then a unit of American Express) from 1990-1993.
Mr. Cracchiolo has 34more than 35 years of experience in the financial services industry. He held senior leadership positions at the American Express Company and its various subsidiaries before becoming the chairman and chief executive officer of Ameriprise Financial when it became a public company in 2005 as a result of our spin-off from American Express. Those positions gave Mr. Cracchiolo experience as a chief financial officer, a manager of significant business lines,industry and a leaderrecord of proven leadership in running global businesses with large complex global operations. As a resultscale operations and thousands of this experience,employees. Mr. Cracchiolo brings to the Board valuable skills andexecutive leadership experience, a strong financial background, in: financial controls and reporting; balance sheet management;effective long-term strategic planning and risk management; marketing; annualmanagement expertise. He has built new businesses, restructured significant lines of businesses, and long-term business planning;negotiated and the negotiation and integrationintegrated a number of successful acquisitions.
Mr. Cracchiolo is a member of the Business Roundtable and Thethe Financial Services Roundtable andRoundtable. He previously served on the boards of directors of the American Council of Life Insurers, and Thethe Financial Services Roundtable. His involvement with these organizations enables Mr. CracchioloRoundtable and on the board of advisors to keep the Board informed on current legislative, regulatory, and economic issues relevant to our businesses.
March of Dimes Foundation. Mr. Cracchiolo holds a bachelor's degree in accounting and economics and a master's of business administration degree in finance, both from New York University. He also holds a Certified Public Accountant designation in New York State and is certified as a General Securities Representative and General Securities Principal in the United States.
Dianne Neal Blixt. Age 54, director since February 26, 2014.
Dianne Neal Blixt |
Ms. Blixt has beenwas a director of Lorillard, Inc., a tobacco company, sincefrom January 2011.2011 to June 2015. She served as Executive Vice President and Chief Financial Officer of Reynolds American Inc. from July 2004 until her retirement in December 2007. Prior to that, she had served as Executive Vice President and Chief Financial Officer of R.J. Reynolds Tobacco Holdings, Inc., a wholly owned subsidiary of Reynolds American Inc., from July 2003 to June 2004. She also served in various roles of increasing responsibility with Reynolds American Inc. and its subsidiaries since 1988. Ms. Blixt is a consultant for Piedmont Distillers and Beeken Biomedical and a principal with C&D Ventures. Ms. Blixt joined the board of directors of Scandinavia Tobacco Group as of February 2016 and serves on the board of directors of NatureWorks Organics, LLC. Ms. Blixt previously served on the board of directors of LandAmerica Financial Group, Inc. from 2006 to 2009 and Metavante Technologies, Inc. from 2007 to 2009. She is also the chair person for the board of trustees for the Reynolda House Museum of American Art.
Ms. Blixt has proven her abilities in financial operations and controls as the executive vice president and chief financial officer of a large public company. In that role, she was closely involved in merger and acquisition activity, expense management, and regulatory relations. She also demonstrated her appreciation for setting the proper tone at the top in terms of integrity and legal and regulatory compliance. A previous position as the vice president of investor relations at the same company gave her experience in clearly communicating corporate strategy and financial and business results to investors and analysts. Ms. Blixt's background and experience, especially as a director at other companies, will beis valuable to the Board as it considers potential acquisitions, monitors balance sheet management, and oversees Ameriprise's enterprise risk management program.
Amy DiGeso.Table of Contents Age 61, director since February 26, 2014.
Amy DiGeso |
Ms. DiGeso most recently was an Executive Vice President, Global Human Resources, at The Estée Lauder Companies, Inc., one of the world's leading manufacturers and marketers of quality skin care, makeup, fragrance and hair care products. Ms. DiGeso retiredproducts, until retiring from herthe position in September 2013 and will remain2013. Ms. DiGeso remained with the Company as Executive Vice President, Senior Advisor to William P. Lauder, Executive Chairman and Fabrizio Freda, President and Chief Executive Officer through June 30, 2014. Prior to rejoining The Estée Lauder Companies in May 2005, Ms. DiGeso was Managing Partner, Human Capital, responsible for global human resources at PricewaterhouseCoopers, a worldwide professional services firm with over 125,000 employees in 142 countries. She has also served as President of Popular Club, Inc., a direct marketing/marketing and sales subsidiary of Macy's, Inc., and held a number of executive management positions at Mary Kay Inc.,
including that of Chief Executive Officer. Earlier in her career she held positions of increasing responsibility at Bankers Trust Company, the American Express Company and Olivetti Corporation of America. She worked previously at The Estée Lauder Companies as Executive Director of Human Resources. Ms. DiGeso is a Pennsylvania State University (Penn State) Alumni Fellow. She holds a Bachelor of Science degree from Penn State and an MBA from Fordham University.
Ms. DiGeso has enjoyed a career that includes being the chief executive officer of a global company and managing the complex human capital needs of large multinational companies. As a result, she has developed a strong understanding of: global operations; marketing and brand management; and strategic planning.planning in the consumer products, financial services and direct selling industries. In addition, she has extensive experience with: executive compensation programs; succession planning; talent recruitment and development; and corporate governance. Ms. DiGeso's background and experience will beis valuable to the Board as it oversees Ameriprise's operations abroad, responds to developments in executive compensation, and continues to enhance its corporate governance framework. In particular, Ms. DiGeso's deep experience with human capital issues will helphelps the Board to advise management on talent recruitment and development, both at the corporate level and with experienced advisor recruitment.
Lon R. Greenberg: Age 63, director since June 7, 2011.
Lon R. Greenberg |
Mr. Greenberg is the Chairman Emeritus and former Chairman and former Chief Executive Officer of UGI Corporation. UGI Corporation is aan international distributor and marketer of energy products and services including propane, butane, natural gas and electricity. HeMr. Greenberg joined UGI in 1980 and held various positions until he became CEO in 1995, a position he held through April 2013. He is alsoAs of January 28, 2016, Mr. Greenberg retired as Chairman of UGI Corporation and AmeriGas Propane, Inc. Prior to joining(a subsidiary of UGI Corporation).
Mr. Greenberg received his B.S. in Economics from The Wharton School of the University of Pennsylvania. He continued his education at Villanova Law School and the Harvard Business School's Advanced Management Program. After clerking for the Superior Court of Pennsylvania, he joined the law firm of Morgan Lewis. Mr. Greenberg also serves on the boards of directors of:of AmerisourceBergen Corporation;Corporation and Aqua America, Inc.; In addition, Mr. Greenberg serves on the boards of these organizations: Temple University andUniversity; Temple University Health System (he currently(of which he also serves as Chairman;Chairman of the Board); United Way of Greater Philadelphia and Southeastern New Jersey (currently serves as Chairman).Jersey; and The Philadelphia Foundation. Mr. Greenberg is a former Chairman of the World LP Gas Association and currently serves as its Treasurer and a former member of its Board of Directors.
Mr. Greenberg, who is an attorney-at-law, has served as the chairman and chief executive officer of a public company since 1996.for 20 years. He has broad experience with the financial, risk management, operational, regulatory and corporate governance issues affecting a public company and its shareholders. Mr. Greenberg also has significant experience in mergers and acquisitions, both in the United States and abroad, which will enable him to provide valuable advice and insights on future transactions to the Board and management.
W. Walker Lewis: Age 69, director since September 30, 2005. Mr. Lewis serves as chairman of Devon Value Advisers, a financial consulting and investment banking firm that he founded in 1997. Prior to that, Mr. Lewis was a senior advisor at Dillon Read and served as a managing director of Kidder Peabody, where he was a member of the firm's management committee. From 1991 to 1993, Mr. Lewis was president of Avon Products Incorporated, North America and a member of the Office of the Chairman of Avon Incorporated. For over twenty years, from 1970 to 1991, Mr. Lewis was a strategic management consultant at Boston Consulting, as Founding Chairman of Strategic Planning Associates, and as Chairman of Mercer Management Consulting, a division of Marsh and McLennan. In his management consulting practice Mr. Lewis consulted to a number of money center banks, large life and casualty insurers, and money management companies. Mr. Lewis has served on twenty public company boards (Owens Corning, Scientific Games, American Management Systems, etc.), and private company boards (Mrs. Fields, Applied Predictive Technologies, etc.) and has participated in a number of public and private company transactions as a financial adviser, consultant, and board member.
Mr. Lewis has many years of experience in financial and management consulting, investment banking and board service at a number of other public and private companies. In these
capacities, he has participated in a number of public and private company transactions. As a result, he contributes to the Board's understanding of executive compensation issues, merger and acquisition activity, investor relations and long-range planning. His experience in investment banking has been particularly useful when the Board considers its capital and liquidity needs and potential acquisitions.
Siri S. Marshall |
Siri S. Marshall: Age 65, director since September 30, 2005. Ms. Marshall is the former senior vice president, general counselSenior Vice President, General Counsel and secretarySecretary and chief governanceChief Governance and compliance officerCompliance Officer at General Mills, Inc., having retired from those positions as of January 1, 2008. Prior to joining General Mills in 1994, Ms. Marshall was senior vice president, general counselSenior Vice President, General Counsel and secretarySecretary of Avon Products, Inc. Ms. Marshall is also a director of Equifax, Inc., Alphatec Holdings, Inc., and the Yale Center for the Study of Corporate Law.Law and Direct Relief. She has previously served as a director of NovaCare,Alphatec Holdings, Inc., the American Arbitration Association, BioHorizons, Inc., Jafra Cosmetics International, NovaCare, Inc., and Snack Ventures Europe, BioHorizons, Inc. and the American Arbitration Association.Europe. She has also served as a member of The New York Stock Exchange Legal Advisory Committee. Ms. Marshall was the recipient of the Sandra Day O'Connor Board Excellence Award in 2011.
Ms. Marshall is an attorney-at-law and former general counsel, chief governance officer, and compliance officer at a Fortune 500 company. As a result, she is very familiar with the broad range of executive leadership issues at large public companies, and in particular, legal, regulatory, and corporate governance challenges. ThroughWith her service on the boards of other companiesbroad experience and participationinvolvement in panel discussions at conferences for directors and attorneys,corporate governance, she keeps the Board informed on current trends, in corporate governance, the approaches taken by other companies to shareholder concerns, and emerging board practices. She has also offered insights into executive succession planning and communications with institutional shareholders and proxy advisory firms.
Jeffrey Noddle: Age 67, director since September 20, 2005.
Jeffrey Noddle |
Mr. Noddle served as chairmanChairman of the board of directors of SUPERVALU INC. from 2002 until he retired in 2010. Previously, Mr. Noddle also served as chief executive officerChief Executive Officer of SUPERVALU since 2001. Prior to that time, Mr. Noddle held a number of other leadership positions at SUPERVALU, including presidentPresident and chief operating officerChief Operating Officer from 2000-2001, corporate executive vice presidentCorporate Executive Vice President and presidentPresident and chief operating officerChief Operating Officer of SUPERVALU's distribution food companies, corporate vice presidentCorporate Vice President — merchandising and presidentPresident of the company's Fargo and former Miami divisions. Mr. Noddle serves as a member of the boards of directorsdirector of The Clorox Company and is the non-executive chairman of the board of Donaldson Company, Inc. He is also a former chairman of the Food Marketing Institute.
Mr. Noddle's service as the chairman and chief executive officer of a Fortune 500 company provided him with valuable experience in a number of areas that are important to the Company, including: mergers and acquisitions, including integration planning and execution; shareholder relations and communications; corporate governance issues; executive officer succession planning; balance sheet management; financial reporting; and long-range planning. He also has contributed to the Board's knowledge of the director recruitment process as it continues to review the current composition and needs of the Board.
H. Jay Sarles:Table of Contents Age 68, director since September 30, 2005.
H. Jay Sarles |
Mr. Sarles is retired, having most recently served as vice chairmanVice Chairman of Bank of America Corporation. Prior to that, he served as vice chairmanVice Chairman and chief administrative officerChief Administrative Officer of FleetBoston Financial with responsibility for administrative functions, risk management, technology and operations, treasury services, corporate strategy and mergers and acquisitions. During his 37 years at Fleet, Mr. Sarles oversaw virtually all of Fleet's businesses at one time or another, including the company's wholesale banking businesses from 2001 to 2003. These included commercial finance, real estate finance, capital markets, global services, industry banking, middle market and large corporate lending, small business services and investment banking businesses.
Mr. Sarles is also a member of the boardsboard of directors of AvalonBay Communities, Inc. and ConnectEDU. Previously, Mr. Sarles hadpreviously served as director of Carlyle Capital Corporation from 2006 to 2009.on several other boards in the financial services industry.
Mr. Sarles has four decades of experience in the financial services industry. As an executive officer at Bank of America Corporation and FleetBoston Financial, he oversaw a wide range of businesses and functions, including technology and operations, treasury services, corporate strategy, mergers and acquisitions and investment banking. As a result, Mr. Sarles makes a valuable contribution to the Board in areas that include balance sheet management, financial reporting and disclosure, risk management, the integration of acquisitions, and long-range planning. Mr. Sarles also serves on several other boards of directors, which allows him to bring a broad perspective on board-related matters to our Board of Directors.
Robert F. Sharpe, Jr.: Age 61, director since September 30, 2005.
Robert F. Sharpe, Jr. |
Mr. Sharpe retired in November 2010, having most recently served as a senior advisor to ConAgra Foods, Inc. Previously he had served in a variety of senior positions with ConAgra since November 2005, including President of Commercial Foods since 2008 and Chief Administrative Officer since 2009. From 2002 until joining ConAgra, Mr. Sharpe was a partner at the Brunswick Group LLC, an international financial public relations firm. Prior to that, he served as senior vice presidentSenior Vice President — public affairs, secretaryPublic Affairs, Secretary and general counselGeneral Counsel for PepsiCo, Inc. from 1998 to 2002. Previously, Mr. Sharpe was senior vice presidentSenior Vice President and general counselGeneral Counsel for RJR Nabisco, Inc. Mr. Sharpe is a former member of the board of directors of Swedish Match AB.
Mr. Sharpe, who is an attorney-at-law, has been responsible for a wide range of functions as an executive officer and general counsel of Fortune 500 companies. His day-to-day experience with the current financial, legal, regulatory and operational issues facing public companies has been valuable to the Board. Mr. Sharpe offers an informed perspective on executive compensation programs to the Board and has advised it on communications with our institutional shareholders. In addition, he has a sound understanding of risk management, financial reporting and disclosure and corporate governance issues.
William H. Turner: Age 73, director since September 30, 2005. Mr. Turner is the Chairman of International College and a senior advisor with Opera Solutions, LLC. Previously, he was the dean of Montclair State University until January 1, 2010, the founding dean of the College of Business at Stony Brook University, and a senior partner at Summus Limited. Prior to that, Mr. Turner was president and chief executive officer of PNC Bank, New Jersey from 1997 to 2000 and chairman of PNC Bank, N.A., New Jersey and Northeast Region from 2000 until his retirement in 2002. Before joining PNC, Mr. Turner was president and co-chief executive officer at Franklin Electronic Publishers, Inc. and vice chairman of Chemical Banking Corporation, which merged with The Chase Manhattan Corporation in 1995. Mr. Turner is currently a member of the boards of directors of FineMark Holdings Inc., Standard Motor Products, Inc. and Volt Information Sciences, Inc. Previously, Mr. Turner had served as director of Franklin Electronic Publishers, Inc. and New Jersey Resources, Inc.
Mr. Turner enjoyed a long career in the financial services industry, particularly in the retail banking sector. Originally trained as a credit officer, he has held a variety of senior banking positions. As a result, he is very familiar with the types of products and services that we offer to our clients and the importance of close cooperation with our regulators. He works closely with our chief financial officer, general auditor, and independent public accountants on a wide range of issues related to financial reporting and disclosure, risk management, regulatory compliance, balance sheet management, and internal controls. Mr. Turner has proven especially helpful in providing guidance and advice to our subsidiary Ameriprise National Trust Bank and the Audit Committee of another subsidiary, Threadneedle Asset Management Holdings Sarl. Mr. Turner's service on other boards and his past leadership roles in the academic world allow him to bring a wide range of experience and new insights to his service on our Board.
Christopher J. Williams |
Mr. Williams is chairman, chief executive officer and founder of The Williams Capital Group, L.P., a financial services firm that provides equity, fixed income, corporate finance and financial advisory related services to corporations and governmental entities. He established the firm in 1994 after holding senior investment banking and capital markets roles at Lehman Brothers and Jefferies & Company. Mr. Williams serves as a director for the Clorox Company, Caesar's Entertainment Corporation and Cox Enterprises. He also previously served on the board of Wal-Mart Stores, Inc. Mr. Williams is Chairman of The Board of Overseers for the Tuck School of Business at Dartmouth College and serves on the board of Lincoln Center for the Performing Arts. Mr. Williams holds a Bachelor of Architecture from Howard University and a Masters in Business Administration from the Tuck School of Business at Dartmouth College.
Mr. Williams has extensive experience in investment banking and finance. He provides the Company with a valuable perspective both as the chairman and chief executive officer of an investment management firm and as a current and former director of several public and private companies, including service as the chairman of an audit committee for a Fortune 100 company. Mr. Williams offers the Company insights on business planning, finance, and long-term strategy.
Item 2 — A Nonbinding Advisory Vote toTo Approve the Compensation of the Named Executive Officers by a Nonbinding Advisory Vote
At our 2011 annual meeting, our shareholders strongly supported the Board's recommendation that a nonbinding advisory vote to approve the compensation of the named executive officers be held annually. As a result, you'll again have the chance to vote on this proposal at our 2015 annual meeting and at each annual meeting through our 2017 annual meeting. AtYou will also have the 2017 annual meeting, you will have another opportunity to vote on how frequently you would like this proposal to be presented to shareholders.shareholders as presented in Item 3 on page 31.
At our April 2010 annual meeting, we voluntarily gave our shareholders the opportunity to cast a nonbinding advisory vote on our executive compensation philosophy, objectives, and policies.
In July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 was signed into law. Among other things, the Dodd-Frank Act requires us to provide shareholders a separate nonbinding advisory vote to approve the compensation of our named executive officers. The named executive officers are the five officers identified in the Summary Compensation Table on page 7054 of this proxy statement. We most recently held such a vote at our 20132016 annual meeting in the manner required by the rules of the Securities and Exchange Commission.
The Compensation and Benefits Committee will review the results of the vote on this proposal carefully with the aid of its independent compensation consultant. Depending upon the results of that review, the committee will take such action, if any, as it deems appropriate. Because this vote is advisory, however, it is not binding on us, our Board of Directors, or the Board's Compensation and Benefits Committee. Also, a negative vote will not overrule any decision made by the Compensation and Benefits Committee.
Before you vote on the resolution below, please read the entire Compensation Discussion and Analysis beginning on page 5034 carefully. The Compensation Discussion and Analysis contains important information about our executive compensation program. It also explains how and why the Compensation and Benefits Committee made specific decisions about the named executive officers' compensation for their 20132016 performance. The final section of the Compensation Discussion and Analysis on page 7053 describes the committee's consideration of the results of the vote on this proposal at our 20132016 annual meeting.
You should also carefully review the tables that immediately follow the Compensation Discussion and Analysis, together with the related narrative disclosure and footnotes.
The Board of Directors recommends a vote "FOR" the following nonbinding advisory resolution. Proxies will be voted "FOR" the resolution unless otherwise specified:
RESOLVED, that the Company's shareholders hereby approve, on an advisory basis, the compensation of the named executive officers as disclosed in this proxy statement, in the Compensation Discussion and Analysis, the Summary Compensation Table, and the other related tables and disclosure.
RESOLVED, that the Company's shareholders hereby approve, on an advisory basis, the compensation of the named executive officers as disclosed in this proxy statement, including the Compensation Discussion and Analysis, the Summary Compensation Table, and the other related tables and disclosure.
The Board of Directors recommends a vote "FOR" the following nonbinding advisory resolution. Proxies will be voted "FOR" the resolution unless otherwise specified:Item 3 — To Adopt and Approve the Amendment and Restatement of the Company's Certificate of Incorporation to Eliminate Supermajority Voting Rights and Effect Certain Other Non-Material AmendmentsOur Board of Directors has unanimously approved an amendment and restatement of the Company's certificate of incorporation (the "Amended and Restated Certificate of Incorporation") that, if adopted and approved by the shareholders, would eliminate all supermajority voting requirements from and make certain additional non-material amendments to the current certificate of incorporation. The Board is now seeking shareholder approval of the Amended and Restated Certificate of Incorporation. The Board believes that the proposed Amended and Restated Certificate of Incorporation is advisable and in the best interest of our shareholders and recommends that the Company's shareholders adopt and approve the Amended and Restated Certificate of Incorporation. Proxies will be voted "FOR" this proposal unless otherwise specified.Article VIII of the certificate of incorporation currently provides that Articles V, VI, VII and VIII of the certificate of incorporation may not be amended, altered or repealed without the affirmative vote of the holders of at least three-fourths (3/4) of the combined voting power of the outstanding stock of the Company entitled to vote generally in the election of directors. Article V of the certificate of incorporation also currently provides that the affirmative vote of the holders of three-fourths (3/4) or more of the combined voting power of the then outstanding stock of the Company entitled to vote generally in the election of directors is required for the Company's shareholders to adopt, amend, alter or repeal any provision of the By-Laws.Our Board is firmly committed to ensuring effective corporate governance and regularly reviews the Company's corporate governance practices. After considering the views of our shareholders who voted in response to last year's shareholder proposal to adopt simple majority vote standards and the current corporate governance environment, our Board has concluded that the Company's supermajority voting provisions should be eliminated. Accordingly, the Board approved, declared advisable and recommends the shareholders adopt and approve the proposed Amended and Restated Certificate of Incorporation which, if approved, would eliminate the supermajority voting provisions of the current certificate of incorporation. If the Amended and Restated Certificate of Incorporation is approved, the Company's By-Laws will be amended and restated to remove corresponding supermajority provisions contained in the current By-Laws.Amended and Restated Certificate of IncorporationIf the Amended and Restated Certificate of Incorporation is adopted and approved by the shareholders, the following amendments will be made to the certificate of incorporation:•The supermajority voting requirements for stockholders to amend the By-Laws of the Company contained in Section 2(f) of Article V of the certificate of incorporation will be eliminated. The effect of this amendment will be to reduce the vote required for our stockholders to amend the By-Laws of the Company from three-fourths of the voting power of the then outstanding stock of the Company to the affirmative vote of a majority of the shares present in person or represented by proxy at a meeting and voting on the proposal to amend the By-Laws.•The supermajority voting requirements for amending Articles V, VI, VII or VIII of the certificate of incorporation contained in Article VIII of the certificate of incorporation will be eliminated. The effect of this amendment will be to reduce the vote required for stockholders to approve amendments to our certificate of incorporation that are approved and recommended by our Board from three-fourthsof the voting power of the then outstanding stock of the Company to a majority of the voting power of the then outstanding stock of the Company.•Articles V and VII of the certificate of incorporation will be amended to remove certain outdated and unnecessary provisions related to the declassification of the Board and the 2005 spin-off of the Company by American Express Company.•Certain non-substantive amendments will also be made to Articles II and IV of the certificate of incorporation.•Exhibit A includes the full text of the Amended and Restated Certificate of Incorporation, which includes the proposed amendments to the current certificate of incorporation.If adopted and approved, the Amended and Restated Certificate of Incorporation would become effective upon the filing with the Secretary of State of the State of Delaware, which we intend to do promptly following the annual meeting of shareholders if shareholder approval is obtained. Our Board may abandon the Amended and Restated Certificate of Incorporation before or after adoption and approval by the shareholders at any time prior to the effectiveness of the Amended and Restated Certificate of Incorporation.The Board has approved corresponding amendments to remove the supermajority provisions contained in our By-Laws, subject to the effectiveness of the Amended and Restated Certificate of Incorporation.Vote RequiredThe affirmative vote of the holders of three-fourths (3/4) of the combined voting power of the stock of the Company entitled to vote generally in the election of directors outstanding as of the record date for this annual meeting of shareholders will be required to adopt and approve the Amended and Restated Certificate of Incorporation. Abstentions, failures to vote and broker non-votes will have the same effect as votes cast against the adoption and approval of the Amended and Restated Certificate of Incorporation.The Board of Directors recommends a vote "FOR" the adoption and approval of the Amended and Restated Certificate of Incorporation. Proxies will be voted "For" the proposal unless otherwise specified.Item 4 — Approval of the Ameriprise Financial 2005 Incentive Compensation Plan, as Amended and Restated, Including Approval of the Material Terms of the Performance GoalsThe information included below is intended to assist our shareholders in determining how to cast their votes on the Ameriprise Financial 2005 Incentive Compensation Plan, as Amended and Restated, which will become effective on April 30, 2014 if approved by our shareholders (the "2014 Restated Plan"). The Board, upon the recommendation of the Compensation and Benefits Committee, voted to approve the 2014 Restated Plan on February 25, 2014 subject to the approval of our shareholders at the 2014 annual meeting. If our shareholders approve the 2014 Restated Plan, we intend to file a Registration Statement on Form S-8 with the Securities and Exchange Commission covering the shares issuable under the 2014 Restated Plan. If our shareholders do not approve the 2014 Restated Plan at the 2014 annual meeting, the 2014 Restated Plan will not be effective. However, we will continue to have the ability to make awards under the Amended and Restated Ameriprise Financial 2005 Incentive Compensation Plan, as approved by our shareholders at the 2010 annual meeting on April 28, 2010 (the "2010 Restated Plan").
HistoryItem 3 — To Approve a Nonbinding Advisory Vote on the Frequency of Shareholder Approval of the 2005 Incentive Compensation Plan
The 2005 Incentive Compensation Plan was originally adopted on September 30, 2005 in connection with the spin-off of Ameriprise from American Express Company, our sole shareholder at that time. Since the plan's initial adoption, we have brought the 2005 Incentive Compensation Plan to our shareholders for approval at our annual meetings in 2007 and 2010. Both of those requests for approval were to update the plan for legal, governance and other compliance changes, to continue to align the terms of the plan with the expressed interestsNamed Executive Officers
In Item 2, we seek a nonbinding advisory vote of our shareholders and to permit deductible performance-based compensation to be awarded under the plan.Prior to this proposal, we have not requested shareholder approval for additional shares under the 2005 Incentive Compensation Plan since it was originally established in 2005.
Structure of the 2014 Restated Plan
Under this proposal, our shareholders are being asked to approve the 2014 Restated Plan, which is basedcompensation of our named executive officers. The Dodd-Frank Act also requires large public companies like us to give our shareholders a nonbinding advisory vote on how frequently they would like to vote to approve that compensation. You can vote to have the 2010 Restated Plan, butopportunity to approve the 2014 Restated Plan also includes the following material revisions from the 2010 Restated Plan:
The vote on "repricing" stock options without shareholder approvalthis proposal, like the vote on Item 2, is advisory and cashing out underwater stock options other than in the contextis not binding on us, our Board of certain acquisition transactions without shareholder approval;
These revisions continue our approach to align the 2005 Incentive Compensation Plan with the interests ofgive our shareholders and with evolving best practices in equity and incentive compensation. These revisions are in additiona vote on this issue at least once every six years. Therefore, absent extraordinary circumstances, our shareholders will next vote on how often to cast an advisory vote to approve the following best practices features already incompensation of the 2010 Restated Plan:named executive officers at our 2023 annual meeting.
The Board of Directors, acting upon the plan does not require "single triggered" vesting upon a change in control, and therecommendation of its Compensation and Benefits Committee, has resolvedrecommends that all awards granted on or after January 1, 2013 shall include "double triggered" vesting (generally conditioning accelerated vesting upon certain terminations of employment following a change in control);
Background on the Request for Additional Shares
Our company operates each of our core business segments in a highly competitive marketplace. In order to maintain our position as one of the top companies in each of those business segments, we need to be able to attract, motivate and retain the most highly qualified and experienced individuals. Of the 37.9 million shares authorized for issuance under the 2010 Restated Plan, we currently have approximately 2.0 million shares available for future awards as of the date of this proxy statement. In order to give us the flexibility to achieve these goals, as well as the global growth necessary to remain a top company in each of our business segments, and to continue to align shareholder and management long-term interests through the use of our long-term incentive programs, the Compensation and Benefits Committee has recommended to the Board that we request our shareholders approve an additional 16.5 million shares for issuance under the 2014 Restated Plan.
As part of the Compensation and Benefits Committee's recommendation to the Boardannual advisory vote to approve the request for an increase incompensation of the total number of shares that will be available for issuance under the 2014 Restated Plan, the committee solicited advice from Cook,named executive officers. The committee's recommendation was made after consultation with its independent compensation consultant, described on page 13, and other external experts to analyze historical share usage (generally referred to as "run rate" or "burn rate") forwhich supports the last several years as well as the dilutive impact of various increases in the total shares available under the plan. Specifically, the Compensation and Benefits Committee considered the following:
Background on the Full Value Award Limit
The Restated 2014 Plan also imposes a 4.5 million share limit on the maximum number of shares that may be awarded in the form of awards other than stock options or stock appreciation rights ("full value shares") after the date of the 2014 annual meeting. When properly balanced with stock options and cash incentive compensation, we believe full value shares are an important element of retention to our compensation program that aligns with shareholder interests. The majority of the full value shares have been awarded to our executive and management level employees other than our named executive officers. Additionally, we have used a number of full value shares to attract new talent as we continue to build a growing and successful company.
We are requesting that shareholders approve this limit on the number of full value shares at this time because we would like to continue to provide full value share awards to management and employees to encourage ongoing retention and to focus their efforts on long-term shareholder value creation. We intend to continue to provide all executives, including our named executive officers, with a higher percentage of full value awards, including restricted share awards and performance share awards (which vest only upon the achievement of specific financial targets over a specified performance period) in order to balance our long-term incentive mixture and provide a meaningful retention vehicle that will retain value through volatile economic times.
Background on the Material Terms of the Performance Goals
We intend that the 2014 Restated Plan provide us with the ability to award performance-based compensation that is designed to be tax deductible by us without regard to the limit under Section 162(m) of the Internal Revenue Code (the "Code"). Therefore, as part of approving the 2014 Restated Plan, we are asking our shareholders to approve the material terms of the performance goals that may be used for purposes of granting awards that are intended to qualify as "performance-based compensation" under Section 162(m) of the Code.
For purposes of Section 162(m) of the Code, the material terms of the performance goals include: (1) the individuals eligible to receive compensation under the 2014 Restated Plan; (2) a description of the business criteria on which the performance goals are based; and (3) the maximum amount of compensation that can be paid to certain employees under the performance goal. We discuss each of these aspects of the 2014 Restated Plan below under the headings "Eligible Participants" or "Qualifying Awards."
In summary, the 2014 Restated Plan does not change the classes of individuals eligible to receive compensation under the 2014 Restated Plan or the business criteria on which the performance goals
are based that are included in the 2010 Restated Plan. However, the 2014 Restated Plan does remove the separate limits on the value of stock awards (other than stock options or stock appreciation rights) and cash awards in favor of a single annual limit of $30 million, whether such awards are denominated in the form of cash or shares, measured for cash awards at the time of payment and for stock awards at the time of grant.
Generally, Section 162(m) of the Code limits the deduction a public company can claim for compensation in excess of $1 million paid in a given year to its chief executive officer and its three other most highly-compensated executive officers (other than its chief financial officer). "Performance-based" compensation that meets certain requirements does not count against the $1 million deductibility limitation. For awards (other than certain stock options and stock appreciation rights) to qualify as performance-based compensation, our shareholders must approve the material terms of the performance goals at least every five years. Such approval does not guarantee that incentive compensation that we pay to our employees will qualify as performance-based compensation for purposes of Section 162(m) of the Code, but will permit the Compensation and Benefits Committee the ability to structure incentive compensation to qualify as performance-based compensation requirements if it chooses to do so. In all cases, the Compensation and Benefits Committee reserves the right to grant compensation that is non-deductible by the Company.
Summary of the Material Features of the 2014 Restated Plan
The full text of the 2014 Restated Plan is attached to this proxy statement as Exhibit B. The principal features of the 2014 Restated Plan are described below, but the description is qualified in its entirety by reference to the text of the 2014 Restated Plan.
Purpose. The principal purpose of the 2014 Restated Plan is to promote the interests of the Company and its shareholders by providing those employees, directors and independent contractors of the Company who are largely responsible for the management, growth and protection of the business of the Company with a proprietary interest in pursuing the long-term growth, profitability and financial success of the Company.
Administration of the Plan. The 2014 Restated Plan is administered by the Compensation and Benefits Committee of the Board, which consists exclusively of directors, each of whom is (a) a "non-employee director" within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934, as amended, (b) an "outside director" within the meaning of Section 162(m) of the Code, and (c) an "independent director" for purpose of the New York Stock Exchange corporate governance listing standards.
committee's decision. The Compensation and Benefits Committee, determines which employees andis composed solely of independent contractorsdirectors, made its recommendation to the Board for the following reasons.
First, an annual advisory vote is consistent with the Board's policy of encouraging ongoing engagement with our shareholders on all matters that are important to them. Second, any shareholder concerns about our executive compensation program can be expressed through a vote without having to wait two or three years. Third, the Board has considered survey data on our institutional shareholders' preferences as to the frequency of the advisory vote to approve the named executive officers' compensation.
We appreciate that other shareholders may believe an advisory vote on compensation should be granted awards pursuant to the 2014 Restated Plan, the type of awards to be granted and the terms of such awards. Only theheld every two years or three years. The Board or, with the prior approval of the Board, the Compensation and Benefits Committee, may grant awards under the 2014 Restated Plan to non-employee directors of the Company. Subject to the terms and limitations of the 2014 Restated Plan, the Compensation and Benefits Committee has full discretion in the administration of the 2014 Restated Plan, including the interpretation and construction of any and all plan provisions, and the amendment, from time to time, of rules and regulations for the administration of the 2014 Restated Plan.
Notwithstanding the Compensation and Benefits Committee's broad authority under the 2014 Restated Plan, other than adjustments due to changes in the Company's capitalization, the committee may not reprice, adjust or amend the exercise price of outstanding stock options or the strike price of outstanding stock appreciation rights, whether through amendment, cancellation and replacement grant, or any other means, nor permit the exchange of an outstanding stock option or stock appreciation right for cash or another award (including another stock option or stock appreciation right with an exercise price below
that of the exchanged award), unless such action is approved by the Company's shareholders. In addition, certain amendments to the 2014 Restated Plan require shareholder approval, as described below.
To the extent not inconsistent with applicable law, including Section 162(m) of the Code, and the rules and regulations of the New York Stock Exchange, the Compensation and Benefits Committee may delegate its authority under the 2014 Restated Plan to one or more of its members or certain executive officers of the Company. Such delegation authority does not extend to any action related to an award to a non-employee director.
Eligible Participants. Employees, non-employee directors and independent contractors of the Company are eligible to receive awards pursuant to the 2014 Restated Plan. Such persons include key employees who are responsible for the management, growth, and protection of the business of the Company. Under the current eligibility guidelines established by the Compensation and Benefits Committee, approximately 1,900 employees, 100 franchise financial advisors, and 9 non-employee directors are eligible to receive awards under the 2014 Restated Plan.
Types of Awards. Generally, the 2014 Restated Plan allows for the grant of any of the following forms of awards: (a) stock options; (b) stock appreciation rights; (c) restricted stock, restricted stock units and other share-based awards; (d) performance awards; and (e) Qualifying Awards (as defined below). Rights to dividends or dividend equivalents may be granted in connection with awards other than stock options and stock appreciation rights; provided, however, that dividends or dividend equivalents may not be paid on any portion of any award that is subject to performance conditions unless and until such performance conditions have been met. Awards may be granted to participants who are foreign nationals or employed outside the United States on such terms and conditions different from those applicable to awards granted to participants in the United States, which may, in the judgment of the Compensation and Benefits Committee, be necessary or desirable in order to recognize differences in local law or tax policy.
Available Shares. Subject to certain anti-dilution adjustments described below, the maximum number of shares or options to purchase shares of common stock that may be issued under the 2014 Restated Plan is 54,400,000. Of such total, no more than 4,500,000 shares may be issued after the 2014 annual meeting for what are referred to as "full value awards," which are awards other than stock options or stock appreciation rights. Up to 54,400,000 shares may be issued subject to "incentive stock options" as defined in Section 422 of the Code.
As of December 31, 2013, 11,293,293 shares of our common stock were subject to outstanding awards under the 2010 Restated Plan. Of the total shares awarded, 2,079,048 are subject to restricted stock awards or performance share awards and 9,214,245 shares are subject to stock options. As of December 31, 2013, there were 4,109,485 shares that remain available to be awarded under the 2010 Restated Plan.
For purposes of counting the number of shares issued against the authorized share pool, awards denominated solely in shares (such as stock options, stock appreciation rights and restricted stock) and other awards that may be exercised for or convertible into shares will be counted against the authorized share pool on the date of grant of the award based on the maximum number of shares underlying the award. Awards denominated other than in shares that are exercisable for or convertible into shares will be counted based on the number of shares actually issued, when issued.
If any shares subject to an award are forfeited, expire or otherwise terminate without issuance of such shares, or any award is settled for cash or otherwise does not result in the issuance of all or a portion of the shares subject to such award, such shares will again be available for issuance under the 2014 Restated Plan. Shares tendered or withheld by the Company to satisfy tax withholding requirements upon the vesting of awards other than stock options and stock appreciation rights will also become available
for issuance under the Plan. In the event that (i) any stock option is exercised through the tendering of shares (either actually or by attestation) or by the withholding of shares by the Company, (ii) withholding tax liabilities arising from a stock option or stock appreciation right are satisfied by the tendering of shares (either actually or by attestation) or by the withholding of shares by the Company, or (iii) any shares are purchased by the Company with the proceeds from stock option exercises, the shares so tendered, withheld or purchased shall not become available for issuance under the 2014 Restated Plan.
Awards granted or shares issued by the Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards, in each case by a company acquired by the Company or with which the Company combines, will not reduce the shares authorized for grant under the 2014 Restated Plan or authorized for grant to a participant in any calendar year.
Shares that may be issued under the 2014 Restated Plan may be authorized and unissued shares or treasury shares, or both, at the sole discretion of the Compensation and Benefits Committee.
Stock Options. A stock option provides for the right to purchase a specified number of shares of common stock at a specified price per share typically called the "exercise price." Generally, the exercise price may not be less than 100% of the fair market value of a share of common stock on the date on which the stock option is granted. The fair market value of a share on the date of grant is determined by the closing share price on such date. A stock option may be either an incentive stock option, which qualifies for special tax treatment, or a nonqualified stock option.
Generally, no stock option may be exercisable after the expiration of ten years from the date such option is granted, or upon the expiration of such earlier date as the agreement granting such option provides. Subject to certain exceptions (e.g., substitute awards issued in connection with a corporate acquisition by the Company, awards granted to a person newly hired or retained to perform services for the Company, awards granted in connection with the promotion of an employee, or the death, disability, retirement or other termination of a participant, or the occurrence of a corporate transaction such as a change in control of the Company), stock options must have a minimum vesting period of one year.
As permitted by the Compensation and Benefits Committee, payment of the exercise price may be made in cash, by tendering previously acquired shares (valued at their then fair market value), by means of a broker-assisted sale program, or by withholding shares otherwise issuable in connection with the exercise of the stock option.
Stock Appreciation Rights. A stock appreciation right is a right to receive the fair market value of a specified number of shares of our common stock less a specified price per share or "strike price." Generally, the strike price may not be less than 100% of the fair market value of a share of common stock on the date on which the stock appreciation right is granted. The fair market value of a share on the date of grant is determined by the closing share price on such date. Stock appreciation rights may be granted alone or in conjunction with a stock option, performance award or other award under the 2014 Restated Plan. The Compensation and Benefits Committee will determine whether stock appreciation rights will be paid in cash, shares or other property, or any combination thereof.
Generally, no stock appreciation right may be exercisable after the expiration of ten years from the date such stock appreciation right is granted, or upon the expiration of such earlier date as the agreement granting such stock appreciation right provides. With the exception of the events described above for stock options, stock appreciation rights must have a minimum vesting period of one year.
Restricted Stock, Restricted Stock Units and Other Share-Based Awards. Restricted stock awards are shares of common stock that are subject to forfeiture during a vesting period, and restricted stock units and other share-based awards are awards that are valued by reference to shares of common stock.
Restricted stock units and other share-based awards may be paid by the Company in cash, shares or other property, or any combination thereof.
The Compensation and Benefits Committee may grant restricted stock, restricted stock units and other share-based awards to participants, either alone or in addition to other awards granted under the 2014 Restated Plan. In addition, restricted stock, restricted stock units and other share-based awards are available as a form of payment of performance awards and other earned cash-based incentive compensation.
Generally, restricted stock, restricted stock units and other share-based awards must have a minimum vesting period of three years from the date of grant (but permitting pro rata vesting over such time) except for: (a) the events defined above for stock options; (b) grants made in the form of performance awards, in which case the minimum vesting period shall be one year; (c) grants made in payment of performance awards and other earned cash-based incentive compensation; (d) grants made solely in lieu of the cash payment of the employee portion of deferred compensation and the earnings thereon; or (e) grants not in excess of a combined aggregate total of 5% of the limit on the number of shares available for full value awards under the 2014 Restated Plan.
Unless otherwise provided in an applicable award agreement, beginning on the date of grant of an award of restricted stock, the participant shall become a shareholder of the Company with respect to all shares subject to the award and shall have all of the rights of a shareholder, including the right to vote such shares and the right to receive distributions made with respect to such shares. A participant receiving an award of restricted stock units or other share-based award shall not possess voting rights with respect to such award.
Performance Awards. Performance awards are awards that are valued based on the achievement of specified performance objectives during a specified performance period. Performance awards may be paid by the Company in cash, shares of common stock or other property, or any combination thereof. Performance awards must have a performance period of at least one year.
Qualifying Awards. Section 162(m) of the Code denies a deduction to any publicly held corporation for compensation paid to certain "covered employees" in a taxable year to the extent that compensation to such covered employee exceeds $1 million. The covered employees of a company are its chief executive officer and its three other most highly compensated executive officers as of the most recent fiscal year end, other than its chief financial officer.
Certain kinds of compensation, including qualified "performance-based compensation," are disregarded for purposes of the deduction limitation. In accordance with Treasury regulations issued under Section 162(m), compensation attributable to stock options and stock appreciation rights will qualify as performance-based compensation if the stock option or stock appreciation right is granted by a compensation committee comprised solely of "outside directors," the plan contains a per-employee limitation on the number of shares for which options or stock appreciation rights may be granted during a specified period, the per-employee limitation is approved by the shareholders, and the amount of compensation the employee could receive is based solely on an increase in the value of the stock after the date of the grant or award. The 2014 Restated Plan is intended to comply with these requirements.
Furthermore, other awards qualify as performance-based compensation if: (a) the award is granted by a compensation committee comprised solely of "outside directors"; (b) the compensation may be paid solely on account of the attainment of one or more pre-established, objective performance goals; (c) the material terms of the performance goals have been previously approved by the shareholders of the Company; and (d) prior to payment of the award, the committee certifies that the performance goals were in fact satisfied.
The Company may grant performance awards under the 2014 Restated Plan that qualify as "performance-based compensation" for purposes of Section 162(m), thereby preserving any available corporate compensation deductions attributable to such awards. To qualify for such exemption, performance awards must relate to one or more of the following performance criteria: (i) net income or operating net income; (ii) return on assets, return on capital, return on equity, return on economic capital, return on other measures of capital, return on sales or other financial criteria; (iii) revenue or net sales; (iv) gross profit or operating gross profit; (v) cash flow; (vi) productivity or efficiency ratios; (vii) share price or total shareholder return; (viii) earnings per share; (ix) budget and expense management; (x) customer and product measures, including market share, high value client growth, and customer growth; (xi) working capital turnover and targets; (xii) margins; and (xiii) economic or other value added measurements. In addition, performance goals may be based on Company, business unit or participant performance and may be measured in absolute terms or as compared to another business, a peer group or a published or special index, as determined in the sole discretion of the Compensation and Benefits Committee.
The maximum number of shares that may be granted under stock options or stock appreciation rights to any participant in any calendar year shall not exceed 3 million shares. Further, the amount payable to any participant with respect to any calendar year for all awards other than stock options or stock appreciation rights may not exceed $30 million. For purposes of the $30 million limit, an award denominated in dollars will be considered to have a value equal to the amount paid under the award and an award denominated in shares will be considered to have a value equal to the number of shares subject to the award multiplied by the value of a share on the date of grant.
Transferability. A participant's rights in an award granted under the 2014 Restated Plan may only be assigned or transferred in the event of death.
Tax Withholding. The exercise or payment of awards and the issuance of shares under the 2014 Restated Plan is conditioned upon a participant making satisfactory arrangements for the satisfaction of any liability to withhold federal, state, local or foreign income or other taxes. The Compensation and Benefits Committee may permit a participant to pay taxes required to be withheld with respect to an award in any appropriate manner, including, without limitation, by the surrender to the Company of shares of common stock owned by such person, or settled with shares of common stock that are part of the award giving rise to the tax withholding liability.
Anti-Dilution Adjustment. If the outstanding shares of our common stock are changed by reason of any stock split, stock dividend, combination, subdivision or exchange of shares, recapitalization, merger, consolidation, reorganization or other extraordinary or unusual event, the Compensation and Benefits Committee will direct that appropriate changes be made in the maximum number or kind of securities that may be issued under the 2014 Restated Plan and in the terms of certain outstanding awards, including the number of shares or securities subject to awards and the exercise price or other stock price or share-related provisions of awards.
Plan Term. The Ameriprise Financial 2005 Incentive Compensation Plan originally became effective on September 30, 2005. The 2014 Restated Plan will become effective upon its approval by the shareholders of the Company. No grants of awards may be made under the 2014 Restated Plan after February 25, 2024.
The benefits to be received by participants and the number of shares to be granted under the 2014 Restated Plan cannot be determined at this time. The amount and form of grants to be made in any
year is to be determined at the discretion of the Compensation and Benefits Committee, and may vary from year to year and from participant to participant.
The 2014 Restated Plan may be amended in whole or in part at any time and from time to time by the Board. However, no amendment may be made without shareholder approval if such amendment would: (a) increase the number of shares of common stock available for grant under the 2014 Restated Plan; (b) expand the types of awards available under the 2014 Restated Plan; (c) materially expand the class of persons eligible to participate in the 2014 Restated Plan; (d) decrease the minimum stock option exercise price or stock appreciation right strike price; (e) amend or repeal the prohibitions against repricing or exchange of awards; (f) increase the maximum permissible term of any stock option or stock appreciation right; (g) reduce the minimum vesting periods for awards; or (h) change the award limits under the 2014 Restated Plan.
The closing market price of a share of our common stock reported on the New York Stock Exchange on March 4, 2014 was $110.28 per share.
Certain Federal Income Tax Consequences of Plan Awards
The following discussion is intended to provide only a general outline of the federal income tax consequences of participation in the 2014 Restated Plan and the receipt of awards or payments thereunder by participants subject to U.S. taxes. It does not address any other taxes imposed by the United States, taxes imposed by any state or political subdivision thereof or foreign jurisdiction, or the tax consequences applicable to participants who are not subject to U.S. taxes.
Incentive Stock Options. A participant will not realize any taxable income, and the Company will not be entitled to any related deduction, when any incentive stock option is granted under the 2014 Restated Plan or upon the exercise of such option by the participant. Upon disposition of the shares after expiration of the statutory holding period, any gain or loss a recipient realizes will be a capital gain or loss. The Company will not be entitled to a deduction with respect to a disposition of the shares by a participant after the expiration of the statutory holding period. Except in the event of death, if shares acquired upon the exercise of an incentive stock option are disposed of before the expiration of the statutory holding period (a "disqualifying disposition"), the participant will be considered to have realized as compensation, taxable as ordinary income in the year of disposition, an amount, not exceeding the gain realized on such disposition, equal to the difference between the exercise price and the fair market value of the shares on the date of exercise of the option. The Company will be entitled to a deduction (subject to applicable tax laws, including Section 162(m) of the Code) at the same time and in the same amount as the participant is deemed to have realized ordinary income. Any gain realized on the disposition in excess of the amount treated as compensation or any loss realized on the disposition will constitute capital gain or loss, respectively.
Nonqualified Stock Options. A participant will not realize any taxable income, and the Company will not be entitled to any related deduction, when any nonqualified stock option is granted under the 2014 Restated Plan. When a participant exercises a nonqualified stock option, the participant will realize ordinary income, and the Company will be entitled to a deduction (subject to applicable tax laws, including Section 162(m) of the Code), equal to the excess of the fair market value of the stock on the date of exercise overconsider the option price. Upon disposition of the shares, any additional gain or loss the participant realizes will be a capital gain or loss.
Stock Appreciation Rights. A participant will not realize income upon the grant of a stock appreciation right. Upon exercise, the participant will realize ordinary income and the Company will be entitled to a corresponding deduction (subject to applicable tax laws, including Section 162(m) of the Code) in an amount equal to the cash received plus the fair market value (on the date received) of any shares or other property received.
Restricted and Unrestricted Stock. Unless the participant files an election to be taxed under Section 83(b) of the Code; (a) a participant will not realize income upon the grant of restricted stock; (b) the participant will realize ordinary income and the Company will be entitled to a corresponding deduction (subject to applicable tax laws, including Section 162(m) of the Code) when the restrictions have been removed or expire; and (c) the amount of such ordinary income and deduction will be the fair market value of the restricted stock on the date the restrictions are removed or expire. If the recipient files an election to be taxed under Section 83(b) of the Code, the tax consequences to the participant and the Company will be determined as of the date of the grant of the restricted stock rather than as of the date of the removal or expiration of the restrictions.
Performance Awards. Generally, a participant will realize ordinary income, and the Company will be entitled to a corresponding deduction (subject to applicable tax laws, including Section 162(m) of the Code), when cash, shares, or a combination of cash and shares are delivered to the participant in settlement of a performance award or certain other stock-based awards. The amount of such ordinary income and deduction will be the amount of cash received plus the fair market value of the shares received on the date they are received.
Approval of this proposal requiresthat receives the affirmative vote of athe majority of the votes cast onto be the proposal at the 2014 annual meeting.frequency preferred by our shareholders.
The Board of Directors recommends that shareholders select an annual advisory vote on the compensation of named executive officers. Proxies will be voted for a "1 Year" advisory vote on the compensation of named executive officers unless otherwise specified. RESOLVED, that the option of once every one year, two years, or three years that receives the affirmative vote of the majority of the votes cast will be considered the preferred choice of shareholders as to the frequency with which the Company is to hold a shareholder advisory vote to approve the compensation of the named executive officers as disclosed in the Company's proxy statement, including the Compensation Discussion and Analysis, the Summary Compensation Table, and other related tables and disclosure. |
Equity Compensation Plan Information
The following table provides information as of December 31, 2013, with respect to compensation plans under which our common stock is authorized for issuance.
| (a) | (b) | (c) | |||||||
---|---|---|---|---|---|---|---|---|---|---|
| ||||||||||
| Number of securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price of outstanding options, warrants and rights | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) — shares | |||||||
Plan category | ||||||||||
Equity compensation plans approved by security holders | 11,320,352 | (1) | $ | 53.12 | 4,109,485 | |||||
Equity compensation plans not approved by security holders | 3,907,349 | (2) | $ | 47.50 | 7,362,947 | (3) | ||||
Total | 15,227,701 | $ | 53.03 | 11,472,432 | ||||||
The Board of Directors recommends a vote "FOR" the approval of the Ameriprise Financial 2005 Incentive Compensation Plan, as Amended and Restated (Effective April 30, 2014), including approval of the material terms of the performance goals. Proxies will be voted "FOR" the proposal unless otherwise specified.
If the shareholders fail to approve the 2014 Restated Plan, it will not become effective and our ability to motivate and retain experienced and highly qualified executives, key employees, directors and independent contractors to think and act like owners through a focus on shareholder value will be severely limited. In addition, if the shareholders fail to approve the 2014 Restated Plan, and any awards made under the plan thereafter may not qualify for the exemption from the limitation on deductible compensation under Section 162(m) of the Code.
Item 5 — Ratification ofTo ratify Audit Committee's Selection of PricewaterhouseCoopers LLP as the Company's Independent Registered Public AccountantsAccounting Firm for 20142017
PricewaterhouseCoopers LLP was our independent accounting firm for the 20132016 fiscal year and the Audit Committee has engaged itthe firm for our 20142017 fiscal year. We disclose the fees paid to PricewaterhouseCoopers LLPPricewaterhouse-Coopers for their services in our 20122015 and 20132016 fiscal years in this section.
On December 4, 2013,November 29, 2016, the Audit Committee approved the engagement of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2014.2017. The Audit Committee confirmed its decision to appoint PricewaterhouseCoopers at the committee's meeting held on February 25, 2014.23, 2017.
We provide important additional information about the Audit Committee's oversight of PricewaterhouseCoopers in the External Auditors section on page 15. We are asking shareholders to ratify the committee's engagement of PricewaterhouseCoopers, subject to the limitation stated in the last sentence of this paragraph. The members of the Audit Committee and the Board of Directors believe that the continued engagement of PricewaterhouseCoopers as our independent registered public accounting firm is in the best interests of the Company and its shareholders. In the event the shareholders fail todo not ratify the appointment, the Audit Committee will consider other accounting firms for 2014.2017. The Audit Committee will be under no obligation, however, to appoint new independent auditors.
One or more representatives of PricewaterhouseCoopers will be present at the meeting with the opportunity to make a statement if he or she desires to do so and will be available to respond to appropriate questions.
As our independent accountant, PricewaterhouseCoopers must meet regulatory requirements relating to independence, including the SEC's auditor independence rules which prohibit accounting firms from having certain financial relationships with their audit clients and affiliated entities. Specifically, as interpreted by SEC staff, under Rule 2-01(c)(1)(ii)(A) of Regulation S-X (the "Loan Rule"), an accounting firm would not be considered independent if it receives a loan from a lender or an affiliate of a lender that is a "record or beneficial owner of more than ten percent of the audit client's equity securities." In connection with the SEC's application of the Loan Rule, PricewaterhouseCoopers has advised us that certain relationships between Pricewaterhouse-Coopers (and certain of its affiliates) and its lenders who also are record owners of various funds in the Columbia Threadneedle family of funds (collectively, the "Columbia Threadneedle Funds") or certain other entities within the Ameriprise Financial, Inc. investment company complex, may implicate the Loan Rule. On June 20, 2016, the Staff of the SEC issued a "no-action" letter confirming that it would not recommend that the SEC commence enforcement action against a fund that continued to fulfill its regulatory requirements under the federal securities laws by using audit services performed by an audit firm that was not in compliance with the Loan Rule in certain specified circumstances. The SEC Staff stated that the relief under the letter is temporary and will expire 18 months after the issuance of the letter. PricewaterhouseCoopers has advised us that, based on its knowledge and analyses of the facts and circumstances, it is not aware of any facts that would preclude reliance by us, our affiliates and other entities within the Ameriprise Financial, Inc. investment company complex on the no-action letter. PricewaterhouseCoopers has also affirmed to us that they are able to exercise objective and impartial judgment with respect to the issues encompassed within its engagement and their audits of us, our affiliates and the Columbia Threadneedle Funds, are independent accountants within the meaning of PCAOB Rule 3520 and in their view can continue to serve as our independent registered public accounting firm. The Company has considered disclosures made to it by PricewaterhouseCoopers of lending relationships described by Pricewaterhouse-Coopers, PricewaterhouseCoopers's representation that it is independent within the meaning of the Public Company Accounting Oversight Board Rule 3520Auditor Independence, and representations made to the Company's Audit Committee by PricewaterhouseCoopers that PricewaterhouseCoopers believes that a reasonable investor possessing all the facts regarding the lending relationships and audit relationships would conclude that PricewaterhouseCoopers is able to exhibit the
requisite objectivity and impartiality to report on the Company's financial statements as the independent registered public accounting firm. Based on the foregoing, the Company does not believe that PricewaterhouseCoopers is incapable of exercising objective and impartial judgment with respect to the audit services to us, our affiliates or the Columbia Threadneedle Funds.
Independent Registered Public AccountantAccounting Firm Fees
The following presents the aggregate fees billed for professional services by PricewaterhouseCoopers, the Company's independent registered public accounting firm for the year beginning January 1, 2013,2016, in fiscal year 2013,2016, and for the year beginning January 1, 2012,2015, in fiscal year 2012,2015, for these various services:
Description of Fees | Fiscal Year 2013 Amount | Fiscal Year 2012 Amount | Fiscal Year 2016 Amount | Fiscal Year 2015 Amount | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | | | | |||||||
Audit Fees | $ | 6,990,000 | $ | 7,457,000 | $ | 9,417,000 | $ | 9,367,000 | ||||||
| | | ||||||||||||
Audit-Related Fees | 2,313,000 | 1,651,000 | $ | 2,305,000 | $ | 2,101,000 | ||||||||
| | | ||||||||||||
Tax Fees | 1,992,000 | 1,942,000 | $ | 1,674,000 | $ | 2,948,000 | ||||||||
| | | ||||||||||||
All Other Fees | 310,000 | 2,833,000 | $ | 543,000 | $ | 260,000 | ||||||||
| | | | | | | ||||||||
Total | $ | 11,605,000 | $ | 13,883,000 | $ | 13,939,000 | $ | 14,676,000 | ||||||
| | | | | | | |
Audit Fees. The audit fees set forth above consist of fees for professional services during each fiscal year in connection with the audit of the Company's annual financial statements, review of financial statements included in the Company's Quarterly Reports on Form 10-Q and services that were provided in connection with statutory and regulatory filings or engagements and other attest services.engagements.
Audit-Related Fees. The audit-related fees set forth above consist of fees for attest, assurance and related services that were reasonably related to the performance of the audit or review of the Company's financial statements.internal controls, including custody rule examinations, service organization control reports, comfort letters, consents, employee benefit plan audits and agreed upon procedures engagements.
Tax Fees. The tax fees set forth above consist of fees for tax services during each fiscal year. Of the $1,992,000$1,674,000 in 20132016 tax fees, $1,738,000$1,634,000 was paid for tax planning and consulting services and $254,000$40,000 was paid for tax preparation services.
All Other Fees. All other fees set forth above consist of fees for miscellaneous advisory and consulting services other than audit, audit-related or tax services.
Services to Associated Organizations
PricewaterhouseCoopers also provided other services to associated organizations of the Company that were charged directly to those organizations. These amounts included $9,931,000$10,001,000 and $9,982,000$9,674,000 for
services provided by PricewaterhouseCoopers in 20132016 and 2012,2015, respectively, primarily for performing audits and tax compliance services for mutual funds, collective funds, and alternative investment funds.
Policy on Pre-Approval of Services Provided by Independent Registered Public AccountantsAccounting Firm
Pursuant to the requirements of the Sarbanes-Oxley Act of 2002, the terms of the engagement of the Company's independent registered public accountantsaccounting firm are subject to the specific pre-approval of the Audit Committee. All audit and permitted non-audit services to be performed by the Company's independent registered public accountantsaccounting firm require pre-approval by the Audit Committee in accordance with pre-approval procedures established by the Audit Committee.
The procedures require all proposed engagements of the Company's independent registered public accountantsaccounting firm for services of any kind to be directed to the Company's general auditor and then submitted for approval to the Audit Committee or to the Audit Committee chairman prior to the beginning of any services. The Audit Committee has delegated such approval authority to its chairman, to be exercised in the intervals between committee meetings.
In 2013,2016, 100% of the services provided by PricewaterhouseCoopers for the Company and its subsidiaries were pre-approved by the Audit Committee or its chairman.
The Board of Directors recommends a vote "FOR" the following resolution. Proxies will be voted "FOR" the following resolution unless otherwise specified:
RESOLVED, that the Audit Committee of the Board of Directors' selection of PricewaterhouseCoopers LLP, independent registered public accountants, to audit the accounts of the Company and its subsidiaries for 2014 is ratified.
Item 6 — A Shareholder Proposal Relating to Political Contributions and Expenditures
Four of our shareholders (collectively, the "Proponents") have jointly submitted a resolution that they intend to present at the annual meeting. Our corporate secretary will promptly provide a shareholder with the name of each of the Proponents and the number of our shares held upon receiving an oral or written request. You may write to Thomas R. Moore, Vice President, Corporate Secretary and Chief Governance Officer, Ameriprise Financial, Inc., 1098 Ameriprise Financial Center, Minneapolis, Minnesota 55474 or call him at (612) 678-0106. The Proponents have not provided us with their addresses as we requested, but we will provide that information as well if the Proponents have provided it by the time you make such a request.
The Proponent's proposed resolution and supporting statement are provided below exactly as we received them, as required by the rules of the Securities and Exchange Commission. The Board of Directors unanimously opposes this proposal and we ask that you please carefully consider the Board's statement in opposition before you vote on this item. Proxies will be voted "AGAINST" the proposal unless otherwise specified. Shareholders will be asked to vote on the proposal only if it is properly presented at the annual meeting in accordance with our By-Laws.
RESOLVED, that the Audit Committee of the Board of Directors' selection of PricewaterhouseCoopers LLP, independent registered public accounting firm, to audit the Compensation Discussion and Analysis In this section of the proxy statement, we describe the material elements of the compensation program for our executive officers, provide an overview of our executive compensation philosophy and explain how and why our Board's Compensation and Benefits Committee makes compensation decisions. The following summarizes key elements of our compensation program and the decisions regarding 2016 executive compensation. This summary is an overview only. We encourage you to read the following pages for a full description of how and why we reached our compensation decisions. Our shareholders have historically supported our compensation program design and decisions through strong Say on Pay votes. Our most recent results in 2016 were 95.8% indicating a "For" vote. Compensation and Benefits Committee Report The Compensation and Benefits Committee has reviewed and discussed with the Company's management the Compensation Discussion and Analysis that MEMBERS OF THE COMMITTEE: Jeffrey Noddle, Chairman, Amy DiGeso, Lon R. Greenberg, Siri S. Marshall and Robert F. Sharpe, Jr. Our executive compensation program operates within a corporate governance framework that is designed to ensure independent oversight, objective advice and analysis, appropriate risk management and transparency. The Compensation and Benefits Committee, which is composed solely of independent directors, has the responsibility to: We provide a detailed description of the Committee's other responsibilities under Below are key elements of our governance and Operating within our established design and The design and further strengthen the alignment between shareholder and management interests. Compensation for the In making its annual compensation decisions, the committee reviews the total direct compensation for each of our named executive officers, as well as the aggregate value of the total incentives being awarded. We use the term "total direct compensation" to refer to the sum of base salary and total incentives. We use the term "total incentives" to refer to the sum of the annual cash incentive award and the long-term incentive The Process to Determine Compensation for our Named Executive Officers Consistent with past practice, for The committee reviews both financial performance and strategic and business accomplishments on an annual basis to ensure alignment with the Company's annual and long-range business plans. Goals are established within the context of the external environment, considering known macroeconomic factors, and regulatory or political changes that can significantly impact our business. Establishing goals at the beginning of 2016 was much more challenging than in prior years given the uncertainty of these external factors and the extreme market volatility that was occurring during the first quarter. As a result, the Committee exercised its discretion when making compensation decisions as described in Step 2. Financial performance is evaluated on an operating basis. The committee evaluates our financial performance based on five weighted operating financial metrics, as originally approved in the Operating Metrics Net revenues Earnings Earnings per diluted share Return on equity excluding AOCI Balance sheet quality Overall Weighted Financial Rating Externally Driven Headwinds Financial Results Segment Contributions to From a balance sheet perspective, in 2016 we continued to improve our Enterprise Risk Management capabilities and drive our shareholder value proposition. Our capital position remains a competitive differentiator and continues to provide flexibility as we work to drive organic growth and explore inorganic opportunities in both wealth management and asset management. Ameriprise total shareholder return ("TSR") improved relative to performance levels experienced in the prior year, with an 8% total return in 2016. A significant portion of the negative performance in the current year was associated with uncertainty around the Department of Labor fiduciary rule ("DOL"). Although this uncertainty persisted for a Strategic and Business Performance The 2016 plan. Our objective is to improve shareholder value by delivering a superior client experience and meeting clients' needs, which we continue to achieve through • Grew the value and quality of our mass affluent and affluent client relationships • Maintained strong advisor productivity levels and retention • Achieved strong experienced recruiting results while improving the quality of advisors hired • Garnered external recognition for our customer-centric approach and overall client experience • Grew retail assets to a record high $479 billion • Garnered more than $10 billion in net flows in fee-based investment advisory accounts • Achieved record Brokerage Cash balances and record 401(k) sales • Expanded and enhanced solution offerings • Ensured strong retention of existing asset and product balances • Delivered strong and competitive investment performance • Built stronger and more competitive franchises across targeted product lines • Experienced outflows higher than plan due to legacy parent relationships, uncertainty with Brexit and an industry shift to passive investments • Increased U.S. Intermediary gross sales and market share, despite the decline of overall industry gross sales • Maintained strong institutional operating metrics and pipeline Protection & Annuities • In Life & Health Insurance, achieved insurance gross dealer concession in excess of plan • In Auto & Home, achieved net written premiums in excess of plan and reserve levels and loss ratios demonstrated steady improvement • In Annuities, drove variable annuities cash sales in excess of plan • Invested for growth and ease of doing business despite the diversion of substantial core resources to the Department of Labor fiduciary rule and other regulatory changes • Executed on $225 million of investment in our core businesses • Delivered $220 million in re-engineering savings, significantly exceeding plan • Achieved industry-leading employee engagement results • Sustained very strong high performer retention and high performer promotion rate • Garnered multiple employer awards • Continued focus on executional excellence, our inclusive culture and competitive employee value proposition • Sustained community giving, volunteerism and nonprofit engagement, reaching over 6,500 nonprofits across the country Net revenues Earnings Earnings per diluted share Return on equity excluding AOCI Balance sheet quality Overall Weighted Financial Rating The committee reviews both financial performance and strategic and business accomplishments on an annual basis to ensure alignment with the Company's annual and long-range business plans. Financial performance is evaluated on an operating basis, which excludes: net realized investment gains or Each year the committee establishes the size of the target total incentive pool. This pool is used to help determine total incentive awards consisting of annual cash incentives, performance shares, restricted stock awards and stock options for the named executive officers, as well as other key executive officers. This target pool is determined with the assistance of the As described in the previous section above, the Company's overall performance rating for The following Incentive Leverage Grid illustrates how the The When the Committee established the performance goals in the first quarter of 2016, it did so in an environment marked by significant equity market volatility, an uncertain economic outlook, and an unpredictable political and regulatory outlook. In that context, the Committee established performance goals that it believed to be reasonable yet challenging for management to achieve in 2016. As the year progressed, however, the markets stabilized and business results improved markedly, helped by the gains in the equity markets after the presidential election. In short, the environment in which the committee set 2016 performance goals changed dramatically and unexpectedly as the year unfolded. Taking into consideration the improved operating environment that was not The application of downward discretion in 2016 does not reflect a change in our core compensation philosophy or design, and the Our chief executive officer discusses the performance of and recommends to the The Before the The aggregate amount of the annual cash and long-term incentive awards that the We provide a long-term incentive opportunity — via PSUs, restricted stock The charts at right summarize the mix of actual incentives awarded to the CEO for 2016 performance and how the target mix of total incentives will change for NEOs next year as compared to 2016. For 2016, the committee and management agreed to change the mix of actual pay to decrease cash and increase PSU awards. Although this differed from the approved plan design, we believed it was important to change given the evolving market and direction we are moving to in 2017. The actual mix of compensation awarded to our named executive officers will vary from the above charts based on each executive officer's position and Company, business, and individual performance. The range of the actual mix of compensation for There were no salary increases for any of the named executive officers in 2016. Total Actual Incentives Total Target Incentives In February The The final award Performance goals were set at the beginning of the three-year period for average ROE and the EPS CAGR. Since TSR is a relative measure, there are no goals necessary for that component of the plan. The table below includes the ROE and EPS goals, and how they correlate to Target, Maximum and Minimum award payouts (i.e., 100% equals 1x target). Results in between those points are interpolated. In evaluating the performance goals at the end of each period, the Committee adjusted for certain approved predefined modifiers under the plan that were unknown or uncontrollable at the time goals were set. For the 2014-2016 period, the Committee adjusted for annual non-cash DAC unlocking impacts, equity market performance outside of established ranges, and specific regulatory driven incremental costs associated with the Department of Labor Fiduciary rule. After adjusting for these items, the award leverage for EPS and ROE was 200%. Ameriprise TSR performance for the 2014-2016 period was below the S&P Financials index which led to a decrease in the final award calculation by 25 pps, which is the maximum reduction under the plan. As stated on page 41, Ameriprise TSR over the longer-term period has outperformed both the S&P Financials index and the S&P 500. Summary of Total Direct Compensation for our Named Executive Officers The table below is not required by the rules of the Securities and Exchange Commission. We are providing it as supplemental information and you should review the Summary Compensation Table on page The Securities and Exchange Commission's rule for when equity awards are reported in the Summary Compensation Table results in a one-year lag between the time the Compensation and Benefits Committee grants the awards and when they are reported in the Summary Compensation Table. For example, in January We believe that the supplemental table below more clearly reflects our pay for performance philosophy and the compensation decisions made by the committee for the named executive officers for each performance year shown.As shown below, total direct compensation for our named executive officers was flat versus last year, with the exception of Mr. Sweeney. His total direct compensation was 5% higher than in 2015. Benefits and Other Compensation. In addition to total direct compensation, our executive officers are eligible to participate in the health, welfare benefit and retirement programs of the Company on the same basis as other employees. We discuss the pension benefits available to our named executive officers on page Deferred Compensation Plan. Executive officers and other eligible employees can elect to participate in a voluntary deferred compensation plan. Investment options under the plan include Ameriprise Financial share units and several of our mutual funds. Participants can defer up to 20% of their annual cash incentive awards earned for the prior year's performance and receive a Company stock match under the plan. The match is equal to 25% of the amount deferred. This match helps to encourage further investment in Ameriprise Financial by executives. The match is subject to a three-year cliff vesting requirement. Plan participants may elect to defer Perquisites. The committee regularly reviews the type and amount of perquisites provided to our executive officers. We provide detailed information about this element of our executive compensation program for our named executive officers in footnote 4 to the Summary Compensation Table, on page As discussed above, the committee determined the Market Compensation Data During The market median and market competitive ranges provided by FW Cook are based primarily on Ameriprise Financial is a leader in each of our core businesses: Advice & Wealth Management; Asset Management; and Protection and Annuities. There is no single company that is comparable to us in every respect. The peer group used for 2016 was reviewed and updated by the committee in February 2016. Genworth Financial was removed from the peer group. Considering advice from FW Cook, the committee believes this change reflects the evolving business of Ameriprise, as well as changes within the industry. This change also helps keep our size, type, and mix of businesses comparable to those of the collective peer group. Prior to this revision, the peer group had not changed since 2014. Collectively, The peer group is one of a number of analytical tools and reference points used by the committee. The committee also reviews and considers historical compensation levels for the executive officer and guidance provided by the committee's compensation consultant. Depending upon the Company's financial results and strategic and business accomplishments and the officer's individual performance, a named executive officer's total direct compensation may be below, The Compensation and Benefits Committee is responsible for overseeing our incentive compensation arrangements, for aligning such arrangements with sound risk management and long-term growth and for verifying compliance with applicable regulations. Based on this assessment and after discussion with management and the committee's independent compensation consultant, for 2016, the committee has concluded that our incentive compensation arrangements and practices do not create risks that are reasonably likely to have a material adverse effect on the Company. The Committee reached this conclusion after considering a number of features of our incentive compensation structure that are designed to mitigate risk, including but not limited to: Also and does not contain features that induce imprudent risk taking. For the NEOs who are covered employees under Section 162(m) of the Internal Revenue Code, the maximum amount that can recognize accounting expense even though the executive officer may never realize any value from the options. Grant practices and procedures. The committee has adopted a Long-Term Incentive Awards Policy that details the policies and procedures we use to grant stock options, restricted stock and performance share units. The policy covers, among other topics: who has the authority to make grants; when grants may be made and when they become effective; required documentation; and our policy for making grants when the committee or our chief executive officer is aware of material nonpublic information about us or our securities. The committee does not consider gains or losses from long-term and equity incentive awards made in prior years, such as stock option exercises and restricted stock vesting, in determining new incentive awards. The committee believes that reducing or limiting current stock option grants, restricted stock awards or other forms of compensation because of prior gains realized by an executive officer would unfairly penalize the officer for high past performance and reduce the motivation for continued high achievement. Similarly, the committee does not consider a loss of value in prior equity awards in determining new incentive awards. Our severance and change in control plans, which we discuss in detail beginning on page 63, do not affect the committee's decisions regarding other elements of compensation. Those plans serve very specific purposes that are unrelated to the determination of a named executive officer's total direct compensation for a specific year. We have posted a copy of our Long-Term Incentive Awards Policy on our website on the Corporate Governance page at The committee adopted the policy in order to document in one place the practices and procedures to be followed in making grants of stock options, restricted stock and performance share units. The committee also wanted to provide the greatest possible transparency and candor to our shareholders concerning our grant practices, particularly with respect to the timing of those grants and our policy for making grants when the committee or our chief executive officer may be aware of material nonpublic information about us or our securities. The committee has established and maintains stock ownership and retention guidelines for our senior leaders to more closely align their interests with the long-term interests of our shareholders. We believe this commitment to stock ownership will continue to play a significant role in driving our success and creating long-term value for our shareholders. Under the guidelines, executive officers are required to beneficially own shares of our common stock equal in market value to a specified multiple of their salary. The shares that count towards this ownership guideline include: shares owned To ensure achievement of the ownership goals, executive officers who have not yet attained the required level of ownership must retain 75% of any restricted stock upon vesting or any stock acquired upon exercise of stock options (net of shares withheld for taxes or exercise costs) until the ownership guideline is attained. We do not enter into individual employment, severance or change in control agreements with our named executive officers. Instead, the rights of our named executive officers to post-employment compensation and benefits are covered by our compensation and benefit plans. Under this "plan approach," the post-employment compensation and benefits of our named executive officers are established uniformly and separately from the other compensation elements. Our use of a plan approach provides many benefits when compared to entering into individual employment agreements with each named executive officer. In most instances, this method ensures consistent terms and provisions and allows us the flexibility to amend or change our practices in response to market trends and best practices. As part of the committee's ongoing review of the Company's programs, the committee's independent consultant reviews our post-employment provisions on an annual basis. The committee utilizes the flexibility afforded by our plan approach to align our executive compensation programs with recent market trends, emerging executive compensation and corporate governance best practices and to be responsive to the opinions and concerns of our shareholders. Under our Senior Executive Severance Plan, severance benefits may become payable only in the event of certain involuntary terminations or if an executive is involuntarily or constructively terminated within two years following a change in control. We offer severance benefits upon certain limited involuntary terminations outside the executive officer's control because we believe that the severance benefits provide income continuity, which results in greater management stability and minimized turnover. Additionally, we have provisions designed to ensure that executives' interests remain aligned with the interests of shareholders should a change in control occur. We believe that this "double trigger" requirement for Additional information regarding each element of our post-employment provisions as well as detailed information on these benefits and the value of potential payments that our named executive officers would receive in various scenarios is provided in the section "Potential Payments Upon Termination or Change of Control for Named Executive Officers," beginning on page In As detailed on page The following table contains compensation information for our chief executive officer, chief financial officer, and the three other executive officers who were the most highly compensated for the year ended December 31, James M. Cracchiolo Chairman and Chief Executive Officer Walter S. Berman Executive Vice President and Chief Financial Officer William F. Truscott Chief Executive Officer, Global Asset Management Colin Moore and Global Chief Investment Officer Joseph E. Sweeney(5) President, Advice & Wealth Management Products and Service Delivery shares/units, and stock options for The Company calculates the grant date fair value of restricted stock awards, performance shares/units and stock options in accordance with the applicable accounting rules. The grant date fair value represents the total compensation expense that the Company will recognize for restricted stock awards and stock options whereas the total compensation expense for performance shares will ultimately be the market value as of the vesting date. For the grant date fair value of restricted stock awards, we use the closing share price on the grant date which does take into account future dividends to be paid on restricted shares. Those dividends will be the same as those paid to other shareholders. For the grant date fair value of performance share awards, we use the closing share price on the grant date which does take into account future dividend equivalents to be paid on performance shares once fully vested and earned. Those dividend equivalents will be the same as those paid to other shareholders over the three-year performance period. In order to calculate the grant date fair value of stock options, we use the Black-Scholes option pricing model. For the stock options that For purposes of calculating the The following table shows the breakout of the major categories of All Other Compensation for the year ended December 31, James M. Cracchiolo Walter S. Berman William F. Truscott Donald E. Froude Colin Moore Name) James M. Cracchiolo Walter S. Berman William F. Truscott Colin Moore Joseph E. Sweeney The table below shows the long-term incentive and equity awards made to our named executive officers in James M. Cracchiolo Walter S. Berman William F. Truscott Colin Moore Joseph E. Sweeney The following table contains information regarding outstanding equity awards held by the named executive officers as of December 31, James M. Cracchiolo Walter S. Berman William F. Truscott Colin Moore Joseph E. Sweeney Option Grant Date 02/07/2014 02/02/2015 02/01/2016 Restricted Stock 02/07/2014 02/02/2015 02/01/2016 The following table contains all stock option exercises and vesting events of restricted stock awards and performance share units for all named executive officers during fiscal year James M. Cracchiolo James M. Cracchiolo Walter S. Berman William F. Truscott Colin Moore Joseph E. Sweeney Walter S. Berman William F. Truscott Donald E. Froude Colin Moore
The Board of Directors recommends a vote "FOR" the following resolution. Proxies will
be voted "FOR" the following resolution unless otherwise specified:
accounts of the Company and its subsidiaries for 2017 is ratified.The Shareholder ProposalResolved, the shareholders ofAmeriprise Financial ("Ameriprise" or the "Company") hereby request the Company to prepare and semiannually update a report, which shall be presented to the pertinent board of directors committee and posted on the Company's website, that discloses the Company's— (a) Policies and procedures for making political contributions and expenditures (both direct and indirect) with corporate funds, including the board's role (if any) in that process, and (b) Monetary and non-monetary political contributions or expenditures that could not be deducted as an "ordinary and necessary" business expense under section 162(e) of the Internal Revenue Code; this would include (but not be limited to) contributions to or expenditures on behalf of political candidates, political parties, political committees and other entities organized and operating under sections 501(c)(4) of the Internal Revenue Code, as well as the portion of any dues or payments that are made to any tax-exempt organization (such as a trade association) and that are used for an expenditure or contribution that, if made directly by the Company, would not be deductible under section 162(e) of the Internal Revenue Code.The report shall identify all recipients and the amount paid to each recipient from Company funds.Stockholder Supporting StatementAs long-termAmeriprise shareholders, we support transparency and accountability in corporate spending on political activities. Disclosure is in the best interest of the Company and its shareholders. Indeed, the Supreme Court's 2010Citizens United decision recognized the importance of disclosure to shareholders. The Court said: "[D]isclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages."Ameriprise contributed at least $166,450 in corporate funds since the 2002 election cycle. (CQ:http://moneyline.cq.com and National Institute on Money in State Politics:http://www.followthemoney.org)We note that our Company discloses a policy on corporate political spending and its contributions to state-level candidates and candidate committees on its website. We believe this is deficient because the Company will not disclose the following expenditures:•A list of trade associations to which it belongs and how much of the company's payments were used for political purposes, and•Payments to any other third-party organizations, including those organized under the sections 527 and 501(c)(4) of the Internal Revenue Service codes, used for political purposes.Information on indirect political engagement through trade associations and 501(c)4 groups cannot be obtained by shareholders unless the Company discloses it. This proposal asks the Company to disclose all of its political spending, direct and indirect. This would bring our Company in line with a growing number of leading companies, includingWells Fargo, JP Morgan & Chase, andCapital One, which support political disclosure and accountability and present this information on their websites.The Company's Board and its shareholders need comprehensive disclosure to be able to fully evaluate the political use of corporate assets. We urge your support for this critical governance reform.The independent Nominating and Governance Committee of our Board of Directors carefully considered the shareholder proposal with the assistance of outside legal counsel. The Board of Directors unanimously agreed with the committee's decision to oppose the proposal and theBoard unanimously recommends that you vote "Against" it for the following reasons, assuming that it is properly presented at the 2014 annual meeting in accordance with our By-Laws:•Our Board of Directors considered these issues more than two years ago. The Board's Nominating and Governance Committee held a special meeting in November 2011 devoted entirely to the subject of corporate political spending. Among many other topics, the committee discussed our memberships in trade associations and whether our dues should be considered a form of political spending. Based in part on the advice of legal counsel, the committee concluded that our dues should not be considered political spending. Two weeks after the committee met, the Board accepted the committee's recommendations for the adoption of a Statement of Principles Governing Corporate Political Spending and the type of disclosures that our shareholders would find most useful. The Board also approved an amended Committee charter giving the committee responsibility for oversight of corporate political spending.Please go to ir.ameriprise.com, click on the Corporate Governance tab, and then go to Guidelines and Principles to view the Statement of Principles and our corporate political spending report for 2013.•Federal law prohibits us from making contributions to candidates for federal office. The United States Supreme Court's 2010 decision inCitizens United didn't change a long-standing law that prohibits corporations and trade associations from contributing to federal candidates, party committees, and political action committees. Moreover, federal tax law prohibits trade associations from being primarily engaged in political activity.State laws vary as to whether corporations or trade associations may contribute to political candidates, but we have not made any such contributions for at least the last two years. Furthermore, we are subject to the Securities and Exchange Commission's strict rules on contributions by investment advisers to certain state and local government officials and candidates, as are many of our employees and financial advisors. To the extent, if any, that we contribute corporate funds to a candidate for state or local office, we will report those amounts on our public website.•Citizens United does not apply to trade association dues. Even afterCitizens United, there is no legal basis for the Proponents to contend that corporations should disclose any portion of their trade association dues. The language in that case concerning disclosures to shareholders of corporate political spending contemplates corporate money used to elect or defeat candidates or for independent expenditures (spending on a public communication that expressly advocates the election or defeat of a clearly identified candidate for political office). Our Statement of Principles expressly prohibits the use of corporate funds for independent expenditures.•Trade association dues are not a form of indirect political spending. The Proponents acknowledge that we post our Statement of Principles and the related annual report on our website, but claim that our disclosure is deficient because we don't disclose how much of our trade association dues were used for "political purposes." The Proponents mistakenly contend, in part, that because the trade associations to which we belong engage in lobbying on legislation and other matters, our dues are a form of indirect political spending.This is contrary to the commonly understood meaning of political spending: money used to influence the election or defeat of a candidate for political office. We join trade associations to promote the best interests of our clients and shareholders and to improve our understanding of the issues affecting our business, not to influence an election. We don't control any trade association or how it uses our dues. In fact, there is no way for us to know how our dues are spent. Simply put, we don't have the information the Proponents want us to disclose.If a trade association asks us to pay a special assessment for political spending, our current policy is to decline such a request. If we do pay such an assessment, we'll report it on our public website.•Like trade associations, many other organizations engage in lobbying. The fallacy of the Proponents' contention that, because trade associations may use some of our dues to conduct lobbying, a portion of our dues therefore is indirect political spending can be easily demonstrated.The list of organizations on the United States Senate's website that file lobbying reports includes: American Cancer Society; American Society for the Prevention of Cruelty to Animals; Boy Scouts of America; Feeding America (formerly known as America's Second Harvest); Greenpeace; National Public Radio; Sierra Club; and Special Olympics. Surely no one who makes a contribution to one of those organizations considers his or her donation to be a political contribution because the organization engages in lobbying.•The information that the proponent wants us to disclose would be misleading to our shareholders. Trade associations inform their members how much of their dues is nondeductible for federal income tax purposes because of the total amount that the trade association spends for certain lobbying and political expenditures.This is an aggregate number that the trade association computes using a formula designed for tax purposes. It's not broken out between lobbying expenses and political spending. Most important, the nondeductible portion of our trade association dues is not necessarily the actual amount ofour corporate funds that were used for those purposes, as trade associations generally estimate the amount of dues spent on lobbying and political activity.This is the principal reason why the Nominating and Governance Committee recommended that this information not be included in our annual corporate political spending report: it would give our shareholders a distorted and misleading picture of the corporate funds actually used for political purposes, as that term is generally understood.•Summary: Our Board of Directors has implemented a reasonable policy governing corporate political spending and disclosures. We believe that the policy has worked well. The Board of Directors continues to believe that our Statement of Principles for Corporate Political Spending and the annual report posted on our website address the issues that are of most concern for our shareholders. After carefully considering in 2011 whether to disclose the information now sought by the Proponents, the Nominating and Governance Committee concluded that such disclosure would be misleading for our shareholders and distort the extent of the Company's political activities. After carefully reviewing and discussing the proposal, that continues to be the committee's position and therefore the Board unanimously agreed that our shareholders be advised to vote against the proposal.COMPENSATION OF EXECUTIVE OFFICERSCompensation of Executive OfficersCOMPENSATION AND BENEFITS COMMITTEE REPORTSummary of 2016 Executive Compensation ActionsTotal Shareholder Return
2012-2016Total Direct Compensation
Chairman and CEO, 2012-2016Total Incentive Mix - Actual
Chairman and CEO – Shifted cash to PSUs
Say on Pay Support from Shareholders
2012-2016followsaccompanies this report. Based upon that review and discussion, the committeeCommittee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the Company's Annual Report on Form 10-K for the year ended December 31, 2013,2016, and in this proxy statement.MEMBERS OF THE COMMITTEE:Jeffrey Noddle, ChairmanLon R. GreenbergW. Walker LewisSiri S. MarshallRobert F. Sharpe, Jr.Compensation Discussion and AnalysisIn this section of the proxy statement, we describe the material elements of the compensation program for our executive officers, including those identified in the Summary Compensation Table on page 70, who are called named executive officers. We also provide an overview of our executive compensation philosophy and explain how and why our Board's Compensation and Benefits Committee arrives at specific compensation policies and decisions.
The Corporate Governance Framework of Our Executive Compensation Program These are some of the key elements of that framework and you can find additional details later in this Compensation Discussion and Analysis:•The Compensation and Benefits Committee is composed solely of independent directors;•The committee has retained Frederic W. Cook & Co., Inc. ("Cook") as its independent compensation consultant. Under the committee's written charter, the compensation consultant reports directly to the committee. The committee is solely responsible for the appointment, oversight, compensation, evaluation, retention, and termination of Cook or any other consultant or advisor. More details about the committee's independent compensation consultant are provided beginning on page 13;•We explain how and when the committee grants equity awards on our website, together with a schedule of anticipated award dates for equity-based grants for the current year;•The committee is prohibited from repricing stock options;•None of our executive officers has an employment agreement with the Company;•We prohibit our executive officers from hedging against a decline in the value of our stock, and from pledging our stock as security for a loan;•Our post-employment provisions of the executive compensation program have been reduced over time to further align with market trends and emerging practices, including the elimination of potential "gross up" payments for excise tax under Section 280G of the Internal Revenue Code;•During 2013 we continued to examine the subject of risk and incentive compensation. When appropriate, the committee considers risk in its decisions related to executive compensation and the findings from our ongoing analyses are detailed on page 66;•The committee has a clawback policy for all named executive officers and other executive officers;•This policy specifies the circumstances under which the committee may exercise its discretion, to the extent permitted by law, to seek the reimbursement or forfeiture of certain cash or equity awards granted on or after January 1, 2011; and•Our incentive compensation program includes both cash and long-term incentives, including performance shares. We determine the incentive awards for our named executive officers using a rigorous and objective framework as described beginning on page 51.
The Role of the Compensation and Benefits Committeeoverseesor shareholders incentive and equity-based compensation plans; andcompensation program. The committee operatesofficer, chief financial officer, and our highest paid named executive officers.aits written charter, approved byhow it operates, and the Board,role of its independent compensation consultant on pages 12-14 of the proxy statement.only independent directors are eligible to serve on the committee. We provide important information about theplan design framework.What We Do What We Don't Do
Adhere to high levels of independence for the Committee and its consultant
No employment agreements
Incorporate sound risk management and risk avoidance in our incentive plan design
No gross ups for potential excise taxes
Require executives to hold a significant portion of stock once vested
No repricing of stock options without shareholder approval
Require a "double trigger" to vest in long-term awards following a change in control
No hedging against the decline in the value of our stock
Regularly review the governance of our programs and make revisions to align with market best practices
No pledging our stock as security for a loancommittee's authority, the extent to which it may delegate its authority to other persons, and its processes and procedures in the section of this proxy statement captioned "Compensation and Benefits Committee" beginning on page 12. That section also includes additional information about the role of our executive officers in recommending the amount or form of executive compensation, and the role of the independent compensation consultant used by the committee during 2013. The committee approved a new Compensation Advisor Policy that is discussed in that section. Among other things, the policy establishes independence standards for the committee's consultant. Cook is engaged exclusively by the committee with respect to executive compensation matters and does not provide any other services to management or the Company. The committee considered the independence of Cook under the new Securities and Exchange Commission rule and the related New York Stock Exchange corporate governance listing standards and concluded that there was no conflict of interest.
Our Executive Compensation Philosophy & ProcessA talented, motivated and experienced workforce is essential to the success of any company. That is true at Ameriprise Financial for all employees, from senior executives to our entry level employees. Just as we compete with other companies for clients in the retail financial services marketplace, we also compete with other companies in the labor marketplace for employees with the talent, knowledge, integrity, and proven ability to produce results. The overall objective of our executive compensation program is to promote the long-term best interests of our shareholders by attracting, retaining and retaining effective, stable,motivating a talented and motivated leadership.Considering all of these factors, the committee has developed anexperienced workforce. Our executive compensation philosophy enables this, and is based on the following core principles: enough to attract and retain executive officers who can achieve the Company's strategic goals and create long-term shareholder value;The committee does not consider gains or lossesOur executive compensation plan design and related policies are reviewed annually and informed by the independent advice of our consultants, market best practices, evolving regulatory trends, guidance from long-termproxy advisory firms, and equity incentive awards made in prior years, such as stock option exercisesfeedback gained through interaction with shareholders through our annual Say on Pay process.restricted stock vesting, in determining new incentive awards. The committee believes that reducing or limiting current stock option grants, restricted stock awards or other forms ofpolicies, the Committee makes compensation because of prior gains realized by andecisions for our executive officer would unfairly penalizeofficers annually following the officer for high past performance and reduce the motivation for continued high achievement. Similarly, the committee does not consider a loss of value in prior equity awards in determining new incentive awards. Our severance and change-in-control plans, which we discuss in detail beginning on page 80, do not affect the committee's decisions regarding other elements of compensation. Those plans serve very specific purposes that are unrelated to the determination of a named executive officer's total direct compensation for a specific year.Compensation for the Named Executive Officers Based on 2013 Performance
four step process summarized below.committeeCommittee has designed our executive compensation program to reflect our executive compensation philosophy. The committeeCommittee has continued to refineevolve the program over time based in part upon the advice of its independent consultant to reflect best practices in executive compensation, simplify the overall plan In 2010, changes toHow our program has evolved program included the creation of theNamed Executive Officers Based on 2016 Performance Share Plan. In 2011, further refinements included the addition of relative weights to our key financial metrics to better define each metric's impact in determining total direct compensation for our named executive officers. In 2012, the committee changed several components of the severance and change-in-control programs for all of our executive officers, reducing the potential future benefits under these programs. No changes were made to the design of our executive compensation programs in 2013. All of the program components are described in detail in the following pages.award. As discussed below, a significant portion of our named executive officers' compensation is composed of performance-based incentives. If performance merits, the committee approves a total incentive pool shortly after the end of each year. award ("LTIA").amount of this pool is based on two factors. The first factor is the committee's assessment of the Company's financial performance and strategic and business accomplishments for the prior year. The second factor is the target total incentive pool for executive officers, including the named executive officers, which is based on competitive market data provided to the committee by its independent compensation consultant. We discuss the performance assessment process for 2013 below, including the nature and use of market compensation data.The committeeCommittee establishes financial performance goals each performance year. These goals are not intended to be a prediction of how the Company will perform during the performance year or in any future period. The committeeCommittee establishes these goals solely to help it align pay with performance. The goals are not intended to provide investors or any other party with guidance about our future financial performance or operating results. We strongly caution you not to take the financial performance metrics or strategic and business accomplishments disclosed below as a form of guidance, because they are not intended to be such. You cannot rely on any of the disclosures contained in the Compensation Discussion and Analysis as a prediction of the Company's future performance.The committeeAs summarized beginning on page 39, the Committee follows a four-step process for determining the total direct compensation of our executive officers, including the named executive officers. As explained in more detail below, the committeeCommittee will: assess performance results; determine the size of the total incentive pool; allocate individual awards; and determine the compensation mix.Step 1: Assess Performance ResultsReview of Financial Results.In this section, we highlight the key financial, strategic and business metrics that the The Compensation and Benefits Committee relies on the Board's independent Audit Committee to review and confirm the financial results used to determinein the totalassessment of 2016 performance. The Compensation and Benefits Committee conducted its review of performance and approved the incentive awards at its meeting on January 24, 2017.
In this section, we highlight the key financial, strategic and business metrics that the Compensation and Benefits Committee used to determine the total incentive pool for our named executive officers.our named executive officers. For 2013,2016, the committee weighted financial performance at 70% and strategic and business accomplishments at 30% in assessing the Company's overall performance. Financial performance is weighted at 70% to reflect the committee's view that these objective measures are the most important indicators of the Company's success. Strategic and business accomplishments are weighted at 30% because the committee believes it is important to assess key accomplishments that may contribute to the achievement of our long-range plan. These weightings are unchanged from the prior year.We use non-GAAP measures2016 PerformanceCompensation Discussion2016 plan. The 2016 plan and Analysis. The appendix to this proxy statementactual results for these metrics are shown below. A rating of "3" represents performance at target, and our Annual Report on Form 10-K forratings of "5" or "4" are above target, with "5" being the year ended December 31, 2013, at page 93, provide GAAP to Non-GAAP reconciliations.highest possible rating. Financial
Metric
Weighting 2016 Plan
($ in millions) 2016 Actual
($ in millions) Rating 15% $ 11,337 $ 11,535 3.9 25% $ 1,344 $ 1,427 4.2 20% $ 7.87 $ 8.48 4.3 20% 19.2% 22.2% 5.0 20% 5.0 4.5 Operating Net Revenues
$ in billionsOperating Earnings
$ in millionsOperating Earnings
Per Diluted ShareOperating Return
on Equity, ex AOCIWe believe that operating measures, which exclude: net realized gains or losses;Financial performance results for Ameriprise in 2016 were solid despite significant environmental and regulatory uncertainty as well as continued market-based headwinds.market impactprior year, putting pressure on variable annuity guaranteed benefits, netfee based revenuehedges,1.36%, putting pressure on spread income and the related deferred sales inducement costs ("DSIC") andannual deferred acquisition costs ("DAC") amortization;unlocking resultsmarket impact on indexed universal life benefits, netDepartment of hedgesLabor fiduciary rulerelated DAC amortization, unearned revenue amortization and the reinsurance accrual; integration and restructuring charges; income (loss) from discontinued operations; and the impact of consolidating consolidated investment entities ("CIEs"), best reflect the underlying performanceeffective Enterprise Risk Managementcore operationsbusiness to Asset Management and facilitateAdvice & Wealth Management while maintaining a more meaningful trend analysis. We use certainstable base in Protection and Annuitiesthese non-GAAP measuresLabor fiduciary ruleevaluate our financial performance on a basis comparable to that used by some securities analysts and investors. Also, certain of these non-GAAP measures are taken into consideration, to varying degrees, for purposes of business planning and analysis and for certain compensation-related matters. Throughout the Compensation Discussion and Analysis, these non-GAAP measures are referred to as operating measures.Pretax
Operating Earnings
(ex. Unlocking, Corp & Other)2013 PerformanceReturn of Capital to Shareholders
2014-2016yearsubstantial part of growth for Ameriprise. Our2016, Ameriprise share price performance rebounded significantly in the fourth quarter as post-presidential election results seem to have removed a portion of the overhang associated with this DOL uncertainty. As additional clarity begins to emerge, we are hopeful that any residual DOL related drag on Ameriprise TSR will further diminish. Over the longer-term horizon, Ameriprise TSR remains strong on both a relative and steady progress demonstrate that we're executing our strategy wellabsolute basis, with returns of 153% over the past five years and building on our solid foundation.286% since we became a public company.Total Shareholder Return
2016Total Shareholder Return
2012-2016market backdrop during the year was mixed. We benefited from strong equity markets, a recovering economycommittee evaluates our strategic and business performance based on four weighted strategic objectives, as originally approved in the United States, and movement from a recessionary to a slow growth environment in Europe. However, like others in the industry, low interest rates continued to pressure our spread-related businesses, which created some headwinds.We navigated the environment well and continued to execute against our priorities. On an operating basis, net revenues grew by 7% to $10.9 billion, and through our combination of business growth and capital management, we drove a 26% increase in earnings per diluted share and generated a 19.7% return on equity (ex. AOCI), up from 16.2% a year ago.steady progress against our four strategic objectives: 1) Drive profitable growth of our Advice & Wealth Management franchise; 2) Profitably grow client assets that we advise, manageobjectives. Our 2016 strategic objectives, key accomplishments, weightings and protect across a range of solutions; 3) Invest to help achieve our long-term growth objectives and re-engineer to improve efficiency; and 4) Engagement, development and retention of talent.ratings are listed below.Our balance sheet fundamentals were further strengthened during the year by the actions we took to implement more robust enterprise risk management processes, as well as by the proactive de-risking of our variable annuity products. Our business generates free cash flow and we returned significant capital to shareholders throughout the year while maintaining nearly $2 billion in excess capital.Drive profitable growth of our Advice & Wealth Management franchisee(30%)
Based on the accomplishments, the committee determined a rating of 4.0.
Profitably grow client assets that we advise, manage and protect across a range of solutions(30%) Advice & Wealth Management
Asset Management
Based on the accomplishments, the committee determined a rating of 3.4.
Invest for long-term growth and re-engineer to
improve efficiencies(25%)
Based on the accomplishments, the committee determined a rating of 5.0.
Engagement, development and retention of talent(15%)
Based on the accomplishments, the committee determined a rating of 4.5.FinancialTotal Calculated Performance RatingOur 2013 financial results exceeded our plan targets and demonstrated strong growth fromBased upon the prior year:2013 operating results compared to 2012 •Net revenues$10.9 billion, up 7% •Earnings$1.5 billion, up 17% •Earnings per diluted share$7.05, up 26% •Return on equity (excluding AOCI)19.7%, up from 16.2%Core drivers included:•consistent execution of our business strategy and initiatives to drive revenue growth;•solid improvement of key metrics across our segments;•balance sheet quality;•a consistent focus on reengineering and ongoing expense management discipline; and•optimization of our business mix.Advice & Wealth Management and Asset Management led our growth as operating earnings in these two businesses grew by 31% compared to the prior year. Our continued emphasis on growing these businesses has helped further evolve our business mix, with these low capital-intensive segments comprising 56% of our total business segment pretax operating earnings in 2013 compared to 51% last year, which was consistent with the progress we have made against our strategy in prior years.As we evolve our earnings mix and free up capital, we are returning significant amounts of capital to shareholders through share repurchases and dividends.In 2013, we returned 130% of our operating earnings to shareholders by devoting nearly $2 billion to share repurchases and dividends, including raising our regular quarterly dividend 16 percent, which represented the sixth increase since 2010. 2013 was the third consecutive year in which we've returned more of our capital to shareholders than we earned — all while holding excess capital and maintaining our strong agency ratings.Overall, our ability to produce these financial and shareholder results is enabled through our balance sheet strength and focus on enterprise risk management. At the close of 2013, key balance sheet elements included:•Capital — excess capital of nearly $2 billion after repurchasing 17.8 million shares of common stock during the year for $1.5 billion and after paying $411 million in quarterly dividends;•Liquidity — $2.6 billion of total enterprise cash and $1.6 billion of cash and highly liquid securities at the holding company;•Asset Quality — diversified investment portfolio with a net unrealized gain of $1.5 billion; and•Hedging — variable annuity living benefit hedging effectiveness of 95%.The committee evaluates our financial performance basedand strategic and business accomplishments described on five weighted operating financial metrics, as originally approved in our 2013 plan. The 2013 plan and actual results for these metrics are shown below.A rating of "3" represents performance at target, and ratings of "1" and "2" are above target, with "1" being the highest possible rating.Financial
Operating Metrics Weighting 2013 Actual
($ in millions) 2013 Plan
($ in millions) Rating 15 % $ 10,857 $ 10,190 1.2 25 % $ 1,460 $ 1,241 1.0 20 % $ 7.05 $ 5.94 1.0 20 % 19.7 % 16.6 % 1.0 20 % 1.0 1.0 Based upon this financial performance,previous pages, the committee evaluated the combined weighted financial rating for 2013 as 1, which is above-target performance.During 2013, our total shareholder return was 88%, outperforming the S&P 500 Index and the S&P Financials Index. In fact, of the 81 companies that comprise the S&P Financials Index, Ameriprise delivered the fifth-highest total shareholder return last year. The five-year total return for Ameriprise common stock was 449%, which also ranked as the fifth-highest within the S&P Financials Index for that time period. Since becoming an independent, public company in 2005, we have delivered the second-highest total return of any firm in the S&P Financials Index:Total Shareholder Return 2013Total Shareholder Return 12/31/08 - 12/31/13Strategic and Business PerformanceThe committee evaluates strategic and business accomplishments holistically and may change its evaluation metrics based on company priorities and specific goals. The committee evaluated 2013 strategic and business accomplishments based on the following four key objectives:1)Drive profitable growth of our Advice & Wealth Management franchise:We drove strong results in our Advice & Wealth Management business in 2013 while we continued to invest to grow our core business, building upon the results we achieved in prior years. We continued to strengthen our reputation as the company with the right expertise to help clients feel confident about their financial futures — as well as the place where productive, experienced advisors can grow even stronger practices.We launched our newConfident Retirement® approach, which our advisors continued to adopt as an effective way of deepening current client relationships and developing new ones, thereby providing a more consistent client and advisor experience. Our advisor force remains strong and stable and we continue to bring in new productive and experienced advisors.The following are key accomplishments for Advice & Wealth Management compared to 2012:•Increased our mass affluent and affluent client base by 9% and total Ameriprise advisor client assets by 16% to $409 billion;•Continued to earn high levels of client retention, satisfaction and likelihood to refer;•Achieved all-time highs in total brand awareness and ad awareness, including through our national advertising campaign featuring Tommy Lee Jones;•Drove high levels of advisor productivity across our advisor channels, with operating net revenue per advisor (ex. former banking operations) increasing 14%;•Delivered strong advisor recruiting and retention results: In 2013, we recruited 310 experienced advisors to the firm. We achieved strong advisor retention, with franchise channel retention of 95% and employee channel at 92%;•Transformed the Ameriprise Advisor Center, our remote advisor channel, to more effectively acquire new clients and deepen relationships with existing clients; and•Recognized in the industry with the following:–# 1 in customer experience across investment firms (Forrester Research, Inc. — 2014 Customer Experience Index Report);–# 1 website (Ameriprise.com), prospect experience for financial institutions (Financial Communications Society 2013 Portfolio Awards);–# 3 web/digital experience in the investment industry (Temkin Report — 2013 Temkin Web Experience Ratings);–Honored as a "customer-obsessed" company, up nine percentage points (Forrester Research — Customer Advocacy report);–Received the Pearl Award — Gold Level for our e-magazine: More Within Reach; and–Increased our Temkin Trust Rating 12%. Scoring 64%, we placed third in trust across the investment firm industry, putting us number 25 across 255 brands measured.2)Profitably grow client assets that we advise, manage and protect across a range of solutions:The company grew assets under management and administration by 13% to $771 billion and life insurance in-force to $194 billion. Advice & Wealth ManagementIn Advice & Wealth Management, we experienced strong asset growth with increased client flows and higher advisor cash sales. Wrap net inflows increased 35% to $13.1 billion — a record for the Company — which helped grow the platform to more than $153 billion. We continued to optimize product and solution offerings by enhancing our managed accounts platform, introducing Fixed Income Portfolio Services and adding to ourActive Portfolios® program, which helped contribute to the significant growth in flows we experienced. Asset ManagementIn Asset Management, we manage assets for retail, institutional and high-net-worth clients from offices in the U.S., U.K. and Asia. And in 2013, we grew AUM by 10% to $501 billion — a record for the segment.Through our acquisitions and steady investment, we've transformed our business and significantly expanded our distribution reach to compete both locally in our core markets of the U.S., U.K. and Europe, as well as globally in Asia, the Middle East and other markets. Additionally, we have enhanced our product platform, including optimizing our product portfolio at Columbia and Threadneedle as well as capitalizing on the strengths of our global investment teams to better compete in key global asset classes, including emerging market debt and equity, global asset allocation and global debt and equities.Through Columbia Management and Threadneedle Investments, we hold top-10 positions in the U.S. and U.K. markets. Our investment teams generated competitive investment performance across our product offerings. As of year-end, we had 117 four- and five-star Morningstar-rated funds.We continue to see signs of improving traction in net flows in our Asset Management segment, although as expected, we continued to experience merger-related outflows in former parent company portfolios/closed block. Our open block of business experienced positive net inflows in 2013. We are pleased with this traction in our open block — including net inflows in U.K./European retail as well as third-party institutional, but recognize there is work to do to achieve net inflows overall. Protection and AnnuitiesIn Protection and Annuities, we continue to meet clients' long-term financial security needs, while also maintaining our risk discipline and generating targeted shareholder returns.Our variable annuity cash sales were $5.2 billion in 2013, driven by positive traction from the introduction of additional fund choices, including new managed volatility funds, continued promotion of annuities' retirement benefits and integration with ourConfident Retirement® approach. We've taken a number of steps over the past few years to further optimize the risk profile of our variable annuity products, including ending third-party sales and adding investment options that are designed to help manage volatility. While we are growing our variable business, fixed annuity sales remained low given the current rate environment.In our Life & Health insurance business, Life Insurance in-force grew to $194 billion through advisor and client engagement in our indexed universal life and variable universal life solutions. We generated $324 million in sales, up 16% from 2012. Additionally, RiverSource launchedTrioSourceSM, a new life/long term care combination solution that fits well with our financial planning approach.In our Auto & Home business revenue increased nearly 9%, net written premiums grew 10% and policies in-force increased 11% over last year. Like others in the industry, we were impacted by weather-related losses in 2013, however, we continued to deepen penetration through affinity partners and grow advisor clients with advisor sales up year over year. Client satisfaction and retention in our property and casualty business remains high and we were ranked number two in overall client satisfaction by a global market research firm.3)Invest to help achieve our long-term growth objectives and re-engineer to improve efficiency:In 2013, we continued to both invest in our core capabilities and growth initiatives and to re-engineer to create efficiencies and to fund re-investment in the business.We continued to invest in our systems and technological capabilities, including upgrades to our client website to improve functionality, performance and availability, increasing ease-of-doing business by improving money movement, enhancing mobility and driving towards a paperless environment. As a result of these actions, advisor satisfaction with technology increased over last year in both the employee and franchisee channels.In addition, the Company launched more than 60 new products firm-wide to address a range of client needs.Our efforts in new businesses focused on continuing to build out our Asia institutional and retail presence with key institutional wins in China, Korea, Hong Kong, Singapore and Indonesia.The Company achieved $209 million in full year re-engineering benefits, ahead of goal, through the completion of over 50 initiatives. We also launched a major operations transformation effort to streamline and drive efficiencies within Clearing and Service Delivery.4)Engagement, development and retention of talent:Throughout 2013, we remained focused on developing and retaining key talent, strengthening engagement and reinforcing our values and culture.•Employee engagement survey results exceeded point of arrival targets in most cases and compared favorably to industry benchmarks;•Our corporate engagement index remained at an all-time high;•Advisor engagement increased from 2012;•High-performer retention remained strong;•We were awarded the Best Companies to Work For Award for the fifth consecutive year by Twin Cities Business Monthly; and•The company received a 100% rating on the Corporate Quality Index by the Human Rights Campaign for the sixth year in a row.Our employee and advisor engagement is also reflected in our giving programs, volunteerism and support for our communities. Key highlights in our community engagement included:•Named to The Civic 50 for the second consecutive year — the award recognizes the S&P 500 companies that best use their time, talent and resources to improve the quality of life where they do business;•Awarded the Charities@Work 2013 Corporate Excellence Award, which is awarded annually to one corporation for overall excellence in employee engagement, corporate social responsibility and campaign management;•Continued our signature partnership with Feeding America and held fourth consecutive National Day of Service achieving record engagement with more than 10,000 individuals in all 50 United states participating in service efforts; and•Conducted our most successful annual giving campaign, achieving record contributions benefiting non-profit organizations in the country and around the globe.Based on the performance for these objectives, the committee provided a combined strategic and business accomplishments rating of 1.5 for 2013,2016 as 4.4, which is above-target performance.The committee evaluated the Company's overallabove target performance rating for 2013 as a 1.2, which is above-target performance (1(4.5 financial performance × 70% + 1.54.1 strategic and business accomplishments × 30% = 1.2)4.4).losses;losses, net of the related deferred sales inducement costs ("DSIC") and deferred acquisition costs ("DAC") amortization, unearned revenue amortization and the reinsurance accrual; the market impact on variable annuity guaranteed benefits, net of hedges, and the related DSIC and DAC amortization; the market impact on indexed universal life benefits, net of hedges and related DAC amortization, unearned revenue amortization and the reinsurance accrual; the market impact of hedges to offset interest rate changes on unrealized gains or losses for certain investments; integration and restructuring charges; income (loss) from discontinued operations; and the impact of consolidating CIEs.consolidated investment entities ("CIEs"). See the reconciliation of certain non-GAAP measures in the appendix to this proxy statement. FinancialThe committee's assessment of the Company's performance for 2013 also took into consideration impacts relateddetermines the extent to which the annual DAC unlocking, strongtarget total incentive pool is funded below, at, or above target.equity market performance relative to our planned expectations, a gain on a strategic business investment, and costs associated with retirement of debt during the year.Review of Financial Results. The committee relies on the Board's independent Audit Committee to review and confirm the financial results used in the assessment of 2013 performance. The Compensation and Benefits Committee conducted its final review of performance and approved the incentive awards at its meeting on January 28, 2014.Step 2: Determine the Size of the Total Incentive Pool
The Committee's assessment of the Company's performance determines the extent to which the target total incentive pool is funded below, at, or above target.committee'sCommittee's independent consultant as described in the section titled "Market Compensation Data". The total target incentive pool for the named executive officers in 20132016 was approximately $24.7$26.5 million.The committee's assessment of the Company's performance determines the extent to which the target total incentive pool is funded below, at, or above target.20132016 was a 1.2. As indicated by4.4.following incentiveTotal Calculated Performance Rating translates into the leverage grid approved by the committee,a rating of a "1.2" equates to total incentive funding of 190% of target. The actual total incentive pool for 2013 of $42.6 million is less than 190% of the target pool because no incentive award leveragethat is applied to the target incentive pool. For example, a "5" rating indicates performance share component of the award. This has the effect of lowering the funded total incentive pool in years ofwell above target funding leverage. and could result in a payout of 200% (or 2x) target, whereas a "1" rating indicates performance well below target and could result in a payout of 0.incentive leverage grid shown below is used as a guideline for the committee to use to determine funding levels, andlevels; as disclosed in prior years, the committee retains discretion to approve aactual funding level that is above or below the guideline value in any given year. For 2013, the committee did not applyWe believe this discretion. Performance Rating 1 2 3 4 5 Funding level as a percentage of the total incentive pool target amount 200% 150% 100% 50% 0% For the named executive officers who are covered employees under Section 162(m) of the Internal Revenue Code, the maximum amount that can be paiddiscretion is important to protect shareholder interests and to avoid defaulting to an individual as an annual cash incentive and restricted stock award is limited to a percentage of the pool. We explain our approach to the federal income tax deductibility of these awards beginning on page 66. There is no minimum funding level for the total incentive pool. Depending upon the committee's assessment of the Company's performance inoverly mechanical outcome that could ignore the context of the year's operating environment in which the Company achieved its results or the actions taken by management in pursuit of the goals. The Committee has rarely exercised this discretion in past years. In 2016, after extensive discussion with both its independent consultant and with management, the committee may decidechose to apply its discretion and reduce the pool leverage from 170% that would have been calculated under the plan to 125% of target.to fund any componentsanticipated when the 2016 performance goals were set, the Committee concluded that 125% pool leverage was reasonable and appropriate in light of management's strong performance against the defined financial metrics and strategic objectives described in Step 1. This application of downward discretion had the net result of funding total incentive awards flat to prior year, rather than increasing funding and associated compensation levels, which would have been the case if the calculated 170% leverage pool forwere approved.namedCommittee remains committed to acting in a manner consistent with the core principles of our executive officers.compensation program in the future.Step 3: Allocate Individual Awards
Individual performance, including the performance of our various business segments, determines the allocation of individual incentives from the total approved poolcommitteeCommittee total direct compensation for each other named executive officer. The chief executive officer's performance assessment for each other named executive officer is based on the following factors, among others, depending on the officer's job responsibilities: the officer's contribution to the Company's financial performance and strategic and business accomplishments; demonstrated leadership ability; the engagement and talent development of their employees; adherence to ethical, legal, and regulatory standards of conduct; risk management skills; improvements in technology and service delivery; and the safety and soundness of the business or staff function's operating environment. None of these factors was assigned a specific target or weight in determining individual awards. Rather, the committee uses a holistic approach in considering these performance factors.Table of Contentsfactors when allocating individual awards from the approved total incentive pool.committeeCommittee evaluates the performance of our chief executive officer based largely on the assessment of the Company's performance as described in the section above captioned "Assess Performance Results."Evaluate Performance."committeeCommittee approves the chief executive officer's compensation, the committeeCommittee discusses its recommendations with the other independent directors in an executive session of the committee meeting.Board. Our chief executive officer is not present for these discussions. This process allows the chairman of the committeeCommittee to explain the committee'sCommittee's basis for its recommendations to the independent directors who are not committee members. It also allows other directors to make comments and ask questions before the committee members conduct a final vote on the chief executive officer's compensation.committeeCommittee approves for the chief executive officer and the other executive officers cannot exceed the amount approved by the committeeCommittee for the total incentive pool. The committeeCommittee may exercise its discretion to award less than the amount available for any named executive officer or the named executive officers as a group. The committeeCommittee also has the discretion to make no such awards.Step 4: Determine the Compensation MixTable of Contents
The Committee generally believes that total compensation for its named executive officers should be targeted, on average, as illustrated in the following charts.The committee generally believes that total compensation for its named executive officers should be targeted, on average, as illustrated in the following charts. We set base salary for our executive officers to be competitive in the market and to allow us to attract and retain executive talent.There were no base salary increases for our named executive officers in 2013. The majority of target total direct compensation for our named executive officers (nearly 90%, on average) is comprised of annual cash and long-term incentives. We provide an annual cash incentive award (AIA) opportunity to our executive officers to motivate and reward them for the accomplishment of key annual goals.(RSAs), performance shares (PSUs)awards ("RSAs"), and stock options — to our executive officers to align their long-term interests with those of shareholders, and to help retain valuable executive talent. TotalHistorically, total incentive compensation ishas been generally split evenly between annual cash and long-term incentives at target. All incentive awards are funded from the total incentive pool and are based on performance.For example, a year with very strong performance will tend to have a higher mix of incentive compensation.A year with relatively lower performance will have a lower mix of incentive compensation. The performance share award value is established and delivered as a fixed percent of the target totalincentive award. As a result, the relative portion of performance share units awarded in the long-term incentive mix may vary from year to year. The committee regularly reviews compensation mix trends and may change the targeted mix from year to year.The target total incentive mix for named executive officers has not changed since 2010.20132016 delivered to our CEOchief executive officer and other named executive officers is summarized below:at right.
Chairman and CEO – 2016
Named Executive OfficersBase SalaryAnnual Incentive AwardLong-Term Incentive Award 5 - 12%Range of Actual Compensation Mix
Named Executive Officers – 2016
Base Salary
6-19% of total pay
49 - 53%
Annual Incentive Award
35-39% of total pay
39 - 43%
Long-Term Incentive Award
46-56% of total pay 2014,2017, the named executive officers received payouts corresponding to the performance share and unit awards that were granted in February 20112014 for the three-year performance period ended December 31, 2013.2016. These awards wereare based on ourROE, EPS, and relative-TSR performance relative toover the established goals for earnings per share (EPS) and return on equity (ROE) shown below.• first step in calculating the award payouts is to determine EPS and ROE results versus goal,factors are weighted 50% each and determine the corresponding payoutpreliminary award leverage. Payout Leverage 200% 150% 100% 50% 0% Actual Result EPS Goal CAGR 14.0% 11.0% 8.0% 0.0% discretionary 19.8% Payout Leverage 200% 150% 100% 50% 0% Actual Result Average ROE Goal 15.0% 14.0% 13.5% 12.0% discretionary 17.3% •second step in calculating the award payouts is torelative-TSR factor can increase or decrease the payoutpreliminary leverage based on relative total shareholder return (TSR) performance. For each percentile Ameriprise is above or below medianup to a range of the total shareholder return of the S&P Financials Index, the leverage is increased or decreased by 1 percentage point, with an impact of no more than 25 percentage points. Ameriprise TSR S&P Financial TSR Ameriprise rank Ameriprise rank TSR Modifier 114% 45% 6 of 81 7th %ile +43% final awards were paid atminimum award under the plan is 0% of target, and the maximum award is 200% of target — the maximum allowed under the plan. Because the awards were earned at maximum based on financial performance, the company's top quartile relative total shareholder return performance did not increase payouts, which is illustrated in the table belowtarget. Measure Leverage Payout Earned Weighting Weighted Payout EPS Goal CAGR 200% x 0.50 = 100% Average ROE Goal 200% x 0.50 = 100% Initial Payout: 200% TSR Adjustment: +43%(25% maximum) Adjusted Payout: 243% Final Payout: 200%(maximum) payments toleverage for the named executive officers2014-2016 performance period is 175% of target, down -25pp from last year's award. The resulting awards are provided below. Further details regarding these awards will be reported in next year's proxy statement in the "Options Exercised"Option Exercises and Stock Vested in 2014"2017" table.Name Award at Target
Award at Target175%Award at 200% James M. Cracchiolo 33,90121,327 shares 67,80237,322 shares Walter S. Berman 10,6306,941 shares 21,26012,146 shares William F. Truscott 12,1126,941 shares 24,22412,146 sharesDonald E. Froude7,240 shares14,480 shares Colin Moore 6,765 shares n/a11,838 shares n/aJoseph E. Sweeney 3,159 shares 5,528 shares
Award Leverage
Average ROE
EPS CAGR
Maximum (200%) 21.8% or above 12.0% or above Target (100%) 20.5% 8% Minimum (0%) Below 17.4% Below 0% 7054 and the following tables for more information about the compensation of our named executive officers. The purpose of this table is to provide a clear picture of the named executive officers' total direct compensation for the 2013, 2012,2016, 2015, and 20112014 performance periods. The supplemental charttable below also differs from the Summary Compensation Table in that it omits the dollar amounts included in the Summary Compensation Table in the columns captioned "Change in Pension Value and Non-Qualified Deferred Compensation Earnings" and "All Other Compensation." Those dollar amounts are unrelated to a named executive officer's performance in a given year and are therefore not included in total direct compensation.20142017 the committee approved equity awards for 20132016 performance. As a result, the SEC's rule requires us to report those awards in the Summary Compensation Table that will be contained in our 20152018 annual meeting proxy statement. The supplemental table below also differs from the Summary Compensation Table because we show the grant date fair value of equity awards based on the year of performance to which they relate. Performance
Year Salary Annual Cash
Incentive Awards Long-Term
Incentive and
Equity Awards(2) Total Direct
Compensation Performance
Year Salary Annual Cash
Incentive
Awards Long-Term
Incentive and
Equity Awards(2) Total Direct
Compensation James M. Cracchiolo, Chairman 2016 $ 1,025,000 $ 6,258,000 $ 9,388,000 $ 16,671,000 and Chief Executive Officer 2015 $ 1,025,000 $ 8,148,000 $ 7,498,000 $ 16,671,000 2014 $ 950,000 $ 11,685,000 $ 9,471,000 $ 22,106,000 James M. Cracchiolo, Chairman 2013 $ 950,000 $ 10,890,000 $ 8,835,000 $ 20,675,000 and Chief Executive Officer 2012 $ 950,000 $ 7,546,000 $ 6,683,600 $ 15,179,600 Walter S. Berman, Executive Vice 2016 $ 675,000 $ 2,243,000 $ 2,893,000 $ 5,811,000 President and Chief Financial Officer 2015 $ 675,000 $ 2,675,000 $ 2,461,000 $ 5,811,000 2011 $ 950,000 $ 8,025,000 $ 6,942,000 $ 15,917,000 2014 $ 650,000 $ 3,800,000 $ 3,080,000 $ 7,530,000 Walter S. Berman, Executive Vice 2013 $ 650,000 $ 3,532,000 $ 2,868,000 $ 7,050,000 President and Chief Financial Officer 2012 $ 650,000 $ 2,457,000 $ 2,176,200 $ 5,283,200 2011 $ 650,000 $ 2,598,000 $ 2,252,000 $ 5,500,000 William F. Truscott, CEO, 2013 $ 650,000 $ 3,532,000 $ 2,868,000 $ 7,050,000 CEO, Global Asset Management 2012 $ 650,000 $ 2,562,000 $ 2,269,200 $ 5,481,200 2011 $ 650,000 $ 2,732,000 $ 2,368,000 $ 5,750,000 Donald E. Froude, President, 2013 $ 550,000 $ 2,210,000 $ 1,790,000 $ 4,550,000 The Personal Advisors Group 2012 $ 550,000 $ 1,596,000 $ 1,413,600 $ 3,559,600 2011 $ 550,000 $ 1,715,000 $ 1,485,000 $ 3,750,000 William F. Truscott, 2016 $ 675,000 $ 1,764,000 $ 2,570,000 $ 5,009,000 Chief Executive Officer, 2015 $ 675,000 $ 2,258,000 $ 2,076,000 $ 5,009,000 Global Asset Management 2014 $ 650,000 $ 3,698,000 $ 3,079,000 $ 7,427,000 Colin Moore, Executive Vice 2013 $ 425,000 $ 3,340,000 $ 2,735,000 $ 6,500,000 2016 $ 475,000 $ 1,912,000 $ 2,588,000 $ 4,975,000 President and Global Chief 2012 (1) $ 425,000 $ 3,451,250 $ 1,723,750 (3) $ 5,600,000 2015 $ 475,000 $ 2,344,000 $ 2,156,000 $ 4,975,000 Investment Officer 2011 (1) $ 425,000 $ 3,337,000 $ 1,663,000 (3) $ 5,425,000 2014 $ 425,000 $ 3,431,000 $ 2,974,000 $ 6,830,000 Joseph E. Sweeney, President, 2016 $ 550,000 $ 1,000,000 $ 1,320,000 $ 2,870,000 Advice & Wealth Management 2015 $ 550,000 $ 1,134,000 $ 1,044,000 $ 2,728,000 Products and Service Delivery 2014(1) $ 500,000 $ 1,724,000 $ 1,398,000 $ 3,622,000 MooreSweeney was not a named executive officer for the 2012 and 20112014 performance years.year. This history is provided in this supplemental table for comparative purposes only and is not required in the Summary Compensation Table on page 70.54.(3)Mr. Moore received performance cash units instead78.more than 20%up to 50% of annual cash incentive awards into this plan, but any amount over 20% is not eligible for the match.70. Perquisites constitute an immaterial element of our executive compensation program.55.
Additional Information Aboutabout Our Executive Compensation Program20132016 incentive compensation for each named executive officer based on the established target total incentive pool, the incentive plan framework and weighted metrics, and 20132016 performance. The committee also relied on guidance from FW Cook, its independent compensation consultant, in determining the funding level of the total incentive pool and the mix of cash and long-term incentives provided from the pool to each named executive officer. Cook provides the committee with updates on competitive market trends throughout the year.2013,2016, FW Cook provided competitive market data to the committee, including a target total incentive pool with competitive range information above and below the market median. several data sources, including proxy disclosures and published survey data. The proxy data is based onfor the competitive peer group shown below. TheMarket data is also supplemented from time to time based on published survey data represents companies in the broader financial services industry and is provided byfrom third-party data providers such as McLagan Mercer, and LOMA. These data sources areMercer. The competitive peer group is evaluated by the committee on an annual basis taking into account the advice of its compensation consultant to confirm they are appropriate given our size, type and mix of business, and the industries we compete in for executive talent.thisthe competitive market data provides an important reference point and market check for the committee in determining how to position pay, and is an important input to the consultant's determination of market median and ranges above and below market median.Ameriprise Financial is the only U.S. company to hold a top ten market position in each of our core businesses, including: Asset Management; Advice & Wealth Management; and Protection and Annuities. As a result, there is no single company that is comparable to us in every respect. Therefore, the committee — with the assistance of Cook — regularly reviews the mix of public firms listed below solely to act as a market check for our executive pay and Company performance. The peer group used for 2013 is shown below.This peer group has not changed since 2010.Asset Management Advice & Wealth Management Protection and Annuities Affiliated Managers Group Bank of New York Mellon GenworthHartford FinancialAllianceBernstein BlackRock Northern Trust Hartford FinancialLincoln NationalBlackRock Franklin Resources Inc. PNC Financial Lincoln NationalMetLife Invesco Schwab (Charles) MetLifePrincipal FinancialLegg Mason T. Rowe Price State Street PrincipalPrudential Financial Prudential Financial Unum Group within,at, or above the median of the market range for the officer's position.
Risk and Incentive CompensationAs in prior years, management,Management, including representatives from each of our material businesses, as well as our human resources, finance, internal audit and legal departments, conduct anconducted the annual internal review of our executive and non-executive incentive compensation programs, policies and practices. The results of this assessment are shared withAmong other factors, the Compensation and Benefits Committee each year.In 2013, a similar assessment was undertaken to review significant revisions to existing compensation arrangements and any new compensation arrangements. The team reviewed and discussed: the various design features and characteristics of new or revised Company-wide compensation policies and programs as well as those at the business unit level; the performance metrics at the Company and business unit levels; and approval mechanisms of all incentive programs for all employees. The team's objective was to determine whether any of these policies or programs could create risks that are reasonably likely to have a material adverse effect on the Company. The results of this assessment are shared with the Compensation and Benefits Committee each year.and holding periods for all of our senior leaders that call for significant stock ownership and align the interests of our senior leaders with the long-term interests of our shareholders;OurThe committee has a clawback policy for all named executive compensation recovery policy allowsofficers and other executive officers, which specifies the Boardcircumstances under which the committee may exercise its discretion, to the extent permitted by law, to seek the reimbursement or forfeiture of Directors to recoup from any executive officer certain cash or equity incentive compensation in the event of a material restatement of our financial results due to intentional misconduct;awards granted on or after January 1, 2011; andin 2013,for 2016, at the request of the committee and consistent with our annual processes, its independent compensation consultant conducted a risk review and assessment of the Company's executive compensation program in which the named executive officers participate. This is similar to the review described in our prior proxy statements. In completing this review, the consultant considered such factors as: mix of total compensation; weighted performance metrics; equity incentive grant types and design; stock ownership guidelines; clawback policies; and performance assessment processes, among others. The committee determined, taking into account the consultant's review, the discussions with management, and the report provided by management that our executive compensation program includes numerous risk mitigating factorsSpecial Tax and Accounting Other ConsiderationsSection 162(m)Our incentive compensation programs have been designed and administered in a manner generally intended to preserve federal income tax deductions. However, the committee considers the tax and accounting consequences of using various forms of compensation and retains the Internal Revenue Code:discretion to pay compensation that is not tax deductibility of certain compensation over $1 million.deductible or could have adverse accounting consequences for the Company.potentially disallow a federal income tax deduction to the Company for compensation over $1 millionbe paid to the chief executive officer and the three most highly compensated named executive officers other than our chief financial officer. These officers, called covered employees, must have been servingan individual as of the last day of Ameriprise Financial's fiscal year to be subject to this limitation in deductibility. One exception to Section 162(m)'s disallowance of a federal income tax deduction for compensation over $1 million applies to "performance-based compensation" paid pursuant to shareholder-approved plans.For thean annual cash incentive and restricted stock awards madeaward is limited to named executive officers, we use a separatepercentage of the pool. This pool operates in conjunction with the incentive pool created to payThere is no minimum funding level for the total incentive awardspool. Depending upon the committee's assessment of our executive officers, including our named executive officers. The separate pool is used as partthe Company's performance in the context of our approachthe year's operating environment, the committee may decide not to provide performance-basedfund any components of the total incentive compensation for Section 162(m) purposes. This pool does not increase the amount of compensation that a named executive officer receives.The committee established the 162(m) incentive pool for 2013 in the first quarter of 2013 and set a maximum percentage of the pool that each named executive officer, other than our chief financial officer, could receive. Our chief financial officer is not a covered employee for purposes of Section 162(m).NEOs.Among the compensation elements that we have discussed so far, the following can generally qualify as performance-based compensation for Section 162(m) purposes, in addition to the cash incentive award: stock options, restricted stock issued from the 162(m) incentive pool, and performance share units. Base salaries and any other compensation that is not considered performance-based will not be deductible to the extent the total of such compensation for a covered employee in any year exceeds $1 million.Although much of the compensation opportunity in our executive compensation program is performance-based and generally deductible for federal income tax purposes, the committee retains the flexibility to award compensation to our named executive officers and other executive officers that is not deductible for federal income tax purposes. We do not represent that the compensation paid to our named executive officers will be deductible for federal income tax purposes to the maximum extent possible.Financial Accounting Standards Board Accounting Standards Codification Topic 718Compensation — Stock Compensation ("ASC 718").Accounting rules govern how to value stock and option awards as of the date of grant, and when those awards are to be recognized as compensation expense. Under this accounting standard, we calculate the full grant date value of awards using a variety of assumptions. This calculation is performed for accounting purposes, as an executive officer may never realize any value from the award. This may happen when the value of a share of stock on which the executive holds an option falls below the exercise price of the option and remains below the exercise price, rendering the option worthless to the executive. In the case of such options, weThis accounting standard also dictates that companies recognize the compensation cost of a stock or option award proportionately over the period that an employee is required to render service in exchange for a share-based payment.
Stock Option, Restricted Stock, and Performance Share Unit Grant Practices and Procedures ir.ameriprise.com.ir.ameriprise.com. That site also includes an expected schedule of equity award grant dates for 20142017 and will be updated for future years' grant date schedules. If you would like a copy of the policy and the expected schedule of 20142017 grant dates, please write to our corporate secretary at the address given on page one of this proxy statement under "General Information." The corporate secretary will send you a copy at no expense to you.
Stock Ownership and Retention GuidelinesOnceIn 2014, the multiple for the chairman and CEO was increased from five times to six times base pay. This further strengthens the ownership requirements and represents best practices. For each of the other named executive officers, the stock ownership guideline is three times his salary. As of December 31, 2016, each of the named executive officers met the stock ownership guidelines are satisfied,under the number of shares associatedpolicy, with the guideline is lockedexception of Mr. Sweeney who was added to the named executive officers in and considered satisfied regardless of movement in our stock price. 2015.directly;directly and shares or phantom stock units held in qualified or nonqualified plans; and unvested restricted stock awards.plans. The shares underlying outstanding stock options and unearned performance shares are not counted as shares owned for the purposes of this ownership guideline. In 2014, the program was also changed so that unvested restricted stock awards made in 2015 and later will no longer be counted as shares owned. Once ownership guidelines are satisfied, the executive officer must retain 50% of any stock acquired, whether by the vesting of restricted stock or upon exercise of stock options, for a one-year holding period.The stock ownership guideline for our chief executive officer is five times his salary, and he has met this goal. For each of the other named executive officers, the stock ownership guideline is three times his salary. As of December 31, 2013, each of the other named executive officers met the stock ownership goals under the policy.
Post-Employment Compensation and BenefitsAs discussed in the Compensation Discussion and Analysis in our 2013 proxy statement, weWe have made a number of reductions to our post-employment benefits for our named executive officers over the past several years, including: reducing the severance multiple, eliminating the gross up for excise tax calculations,on "parachute payments", and adding a "double trigger" for accelerated equity vesting underfollowing a change in control.control of the Company. There were no changes to these programs in 2016.certainqualifying terminations following a change in control maximizes shareholder value because it ensures our named executive officers do not receive an unintended windfall by receiving a severance payment while maintaining their positions following a change in control. We believe this approach is a reasonable means to protect our named executive officers in the event of a change in control and align their interests with those of our shareholders because providing change in control benefits should eliminate, or reduce, any reluctance on the part of our named executive officers to pursue potential change in control opportunities that may be in the best interests of our shareholders.80.63.
The Committee's Consideration of the 20132016 Nonbinding Advisory Vote to Approve the Compensation of our Named Executive Officers20132016, approximately 88%96% of the shares voted approved the compensation of our named executive officers for the 20122015 performance year. At the time of the 20132016 vote, the committee had already approved the design and goals of our executive compensation program for the 20132016 performance year. The committee has reviewed and discussed: these voting results; the absence of comments received from shareholders; and the voting results on this proposal at members of our peer group. After its review and discussion, the committee concluded that the 20132016 vote affirmed shareholder support of our executive compensation program and the committee's decision-making process and therefore did not changeprocess. Nevertheless, the designcommittee, with the advice of FW Cook, approved certain changes to the program or2017 that are explained on page 46. The committee believes that these changes will be viewed favorably by our shareholders, based on the committee's decision-making process with respect to 2014 as a resultfeedback provided by some of our institutional shareholders during the 2013 vote.engagement effort, which is also described on page 35.6448 and in the footnotes to the Summary Compensation Table below,on page 55, the "Total" compensation numbers in the Summary Compensation Table donot represent the total direct compensation earned by the named executive officers for 20132016 performance. The reasons are explained in the footnotes and in the Compensation Discussion and Analysis. We urge you to consider these points carefully when reviewing the Summary Compensation Table.2013.2016.Name & Principal Position Year Salary
($) Bonus
($) Stock
Awards
($)(1) Option
Awards
($)(1) Non-Equity
Incentive
Plan
Compensation
($)(2) Change in
Pension Value
and
Non-Qualified
Deferred
Compensation
Earnings
($)(3) All Other
Compensation
($)(4) Total
($) Year Salary
($) Bonus
($) Stock
Awards
($)(1) Option
Awards
($)(1) Non-Equity
Incentive
Plan
Compensation
($)(2) Change in
Pension Value
and
Non-Qualified
Deferred
Compensation
Earnings
($)(3) All Other
Compensation
($)(4) Total
($) 2016 $ 1,025,000 $ 0 $ 1,630,000 $ 3,260,000 $ 6,258,000 $ 1,220,414 $ 608,761 $ 16,610,175 $ 2,608,000 2015 $ 1,025,000 $ 0 $ 2,337,000 $ 4,674,000 $ 8,148,000 $ 1,298,671 $ 728,300 $ 20,670,971 $ 2,460,000 James M. Cracchiolo 2013 $ 950,000 $ 0 $ 1,509,200 $ 3,018,400 $ 10,890,000 $ 334,576 $ 894,093 $ 19,752,269 Chairman and Chief $ 2,156,000 Executive Officer 2012 $ 950,000 $ 0 $ 1,602,000 $ 3,204,000 $ 7,546,000 $ 1,709,710 $ 680,721 $ 17,828,431 $ 2,136,000 2014 $ 950,000 $ 0 $ 2,180,000 $ 4,360,000 $ 11,685,000 $ 2,064,639 $ 920,553 $ 24,455,192 2011 $ 950,000 $ 0 $ 1,886,000 $ 3,771,000 $ 8,025,000 $ 1,566,448 $ 661,137 $ 18,849,585 $ 2,295,000 2016 $ 675,000 $ 0 $ 535,000 $ 1,070,000 $ 2,243,000 $ 555,663 $ 182,977 $ 6,117,640 $ 856,000 2015 $ 675,000 $ 0 $ 760,000 $ 1,520,000 $ 2,675,000 $ 629,665 $ 206,203 $ 7,265,868 $ 800,000 $ 1,990,000 2014 $ 650,000 $ 0 $ 707,000 $ 1,414,000 $ 3,800,000 $ 628,386 $ 255,826 $ 8,202,212 $ 747,000 Walter S. Berman 2013 $ 650,000 $ 0 $ 491,400 $ 982,800 $ 3,532,000 $ 404,597 $ 245,994 $ 7,008,791 2016 $ 675,000 $ 0 $ 451,000 $ 903,000 $ 1,764,000 $ 261,595 $ 105,337 $ 4,881,932 $ 722,000 2015 $ 675,000 $ 0 $ 740,000 $ 1,479,000 $ 2,258,000 $ 236,964 $ 144,414 $ 6,393,378 $ 860,000 2014 $ 650,000 $ 0 $ 707,000 $ 1,414,000 $ 3,698,000 $ 494,934 $ 216,294 $ 7,927,228 $ 747,000 2016 $ 475,000 $ 0 $ 469,000 $ 937,000 $ 1,912,000 $ 162,070 $ 2,950 $ 4,708,020 Executive Vice President $ 702,000 $ 750,000 and Chief Financial 2012 $ 650,000 $ 0 $ 520,000 $ 1,039,000 $ 2,457,000 $ 473,185 $ 209,029 $ 6,041,214 Officer $ 693,000 2015 $ 475,000 $ 0 $ 686,000 $ 1,373,000 $ 2,344,000 $ 191,326 $ 2,510 $ 5,986,836 $ 915,000 2011 $ 650,000 $ 0 $ 591,000 $ 1,182,000 $ 2,598,000 $ 471,212 $ 212,955 $ 6,329,167 2014 $ 425,000 $ 0 $ 669,000 $ 1,338,000 $ 3,431,000 $ 245,641 $ 1,861 $ 6,838,502 $ 624,000 $ 728,000 William F. Truscott 2013 $ 650,000 $ 0 $ 512,400 $ 1,024,800 $ 3,532,000 $ 3,801 $ 195,639 $ 6,650,640 CEO, Global Asset $ 732,000 Management 2012 $ 650,000 $ 0 $ 546,000 $ 1,093,000 $ 2,562,000 $ 439,411 $ 151,148 $ 6,170,559 $ 729,000 2011 $ 650,000 $ 0 $ 674,000 $ 1,347,000 $ 2,732,000 $ 394,399 $ 167,362 $ 6,675,761 $ 711,000 Donald E. Froude 2013 $ 550,000 $ 0 $ 319,200 $ 638,400 $ 2,210,000 $ 86,204 $ 170,575 $ 4,430,379 President, The Personal $ 456,000 Advisors Group 2012 $ 550,000 $ 0 $ 342,000 $ 686,000 $ 1,596,000 $ 146,381 $ 139,303 $ 3,916,684 $ 457,000 2011 $ 550,000 $ 0 $ 403,000 $ 806,000 $ 1,715,000 $ 137,433 $ 132,595 $ 4,169,028 $ 425,000 Colin Moore(5) 2013 $ 425,000 $ 0 $ 517,125 $ 689,500 $ 3,857,125 $ 154,801 $ 297 $ 5,643,848 Executive Vice President and Global Chief Investment Officer 2016 $ 550,000 $ 0 $ 227,000 $ 454,000 $ 1,000,000 $ 215,640 $ 113,414 $ 2,923,054 $ 363,000 2015 $ 550,000 $ 0 $ 345,000 $ 690,000 $ 1,134,000 $ 228,593 $ 123,865 $ 3,434,458 $ 363,000 20132016 performance. These amounts represent the grant date fair value of restricted stock awards, performance20122015 performance, but granted on February 4, 2013.1, 2016. For 2013,2016, there are two amounts listed in the stock awards column. The top number is the restricted stock award earnedgranted for 2012.2015. The bottom number is the performance share award/unit granted at target for 2012.2015. The actual number of performance shares/units that will be earned at the vesting date is dependent upon future company performance and can range from 0 to 200% of target.became effectivewere granted on February 4, 2013,1, 2016, we used the following assumptions for purposes of the Black-Scholes option pricing model: (i) an expected life of 5 years for each option; (ii) a dividend yield of 3.00%2.25%; (iii) an expected stock price volatility of 41.25%26.62%; and (iv) a risk-free rate of return of 0.882%1.329%.2013,2016, this number is the cash incentive award that was earned for 20132016 performance. For 2012,2015, this number is the cash incentive award that was earned for 20122015 performance. For 2011,2014, this number is the cash incentive award that was earned for 20112014 performance. For Mr. Moore, this column also reflects the performance cash unit that he was awarded on February 4, 2013. The target value of his performance cash award was $517,125. (Note: in 2013, Mr. Moore received a performance cash award rather than a performance share award since he was not a participant in the performance share unit award plan at time of award.)20132016 under the Company's retirement plans as described in the Pension Benefits Table of this proxy statement, effective December 31 of each fiscal year.20132016 amounts disclosed for All Other Compensation primarily consist of: (i) employer contributions under the 401(k) plan; (ii) the annual executive perquisites allowance, which is $35,000 for Mr. Cracchiolo and $25,000 for each other named executive officer, except Mr. Truscott and Mr. Moore who do not receive this allowance. Mr. Truscott receives a reimbursement of up to $1,500 on financial planning fees paid to an Ameriprise financial advisor;allowance; (iii) a Company matching contribution on voluntary deferrals of the 2016 cash incentive award under the deferred compensation plan of the 2013 cash incentive award that are credited in the form of deferred share units; (iv) incrementalthe cost of usingmaintaining a Company leased apartment instead of hotel for business travel to Minneapolis;Minneapolis (which was $43,887 in 2016 for Mr. Cracchiolo); (v) the incremental cost associated with certain personal use of the aircraft and Company-provided vehicle and driver, as required by the Company's security program (defined below); (vi) club membership fees which are used primarily for business purposes; (vii) reimbursement of certain income tax liabilities related to a specific business trip (although business travel ordinarily does not result in imputed income for an employee, the Company imputed income to these named executive officers in this instance in order to optimize its tax treatment for the business travel and the amount of the associated tax reimbursement for each officer is shown following his name: Messrs. Cracchiolo ($3,711), Berman ($7,235), and Froude ($6,833)); (viii) Company reimbursement of spousal travel for certain Company events; and (ix)(viii) gifts provided in conjunction with Company events. As a part of the CEO security program approved by the Compensation and Benefits Committee, the Company provided Mr. Cracchiolo with the following: security system monitoring for his personal residences; use of a car and driver for business and commuting purposes; use of our corporate aircraft by Mr. Cracchiolo and others for business and personal travel.20132016 incremental cost for use of the car and driver, a per mile rate was determined using vehicle maintenance, fuel, and toll expenses and applying the calculated rate to all miles associated with commuting or personal use. The Company used the following methodology for determining the incremental cost for personal usage of the corporate aircraft: (a) when used solely for personal travel, an hourly flight rate (that considers fuel, maintenance and miscellaneous flight costs) plus any direct expense associated with in-flight catering is applied; and (b) when others accompany executives during regular business travel, the incremental cost reflects those direct expenses associated with in-flight catering only. For purposes of calculating the incremental cost of the personal use of corporate aircraft during 2013,2016, the following per flight hourly costs were used, rounded to the nearest dollar: $5,463$5,040 or $5,139,$4,747, depending upon the aircraft used.2013.2016.Name Company
Contributions
to the 401(k) Matching
Contributions
to Deferred
Compensation
Plan Annual Cash
Perquisites
Allowance or
Reimbursement
of Financial
Planning Fees Personal
Use of
Corporate
Aircraft $ 12,750 $ 544,500 $ 35,000 $ 206,935 $ 12,750 $ 176,600 $ 25,000 $ 7,985 $ 12,750 $ 176,600 $ 1,500 $ 0 $ 12,750 $ 110,500 $ 25,000 $ 14,877 $ 0 $ 0 $ 0 $ 0 Company
Contributions
to the 401(k) Matching
Contributions
to Deferred
Compensation
Plan Annual Cash
Perquisites
Allowance Personal
Use of
Corporate
Aircraft $ 13,250 $ 312,900 $ 35,000 $ 144,962 $ 13,250 $ 112,150 $ 25,000 $ 5,022 $ 13,250 $ 88,200 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 13,250 $ 50,000 $ 25,000 $ 850 Because Mr. Moore is being included asSweeney was not a named executive officer for the first time, we2014 performance year. We are only required under the proxy disclosure rules to include his compensation for 2013.2015 and 2016.
Grants of Plan-Based Awards in 201320162013.2016. These awards were based on 20122015 performance and funded from the 20122015 total incentive pool. Stock options will not have value unless there is an increase in share price above the option exercise price. Performance share and cash awards will not have value unless minimum performance results are achieved. Estimated Future Payouts
Under Equity Incentive
Plan Awards and
Performance Awards(1) All Other
Option Awards
(# of
securities
Underlying
Options)
(#)(3) All Other
Stock Awards
(# of shares
of Stock
or Units)
(#)(2) Exercise or
Base Price
of Option
Awards
($/share)(4) Grant Date
Fair Value of
Awards
($)(5) Grant
Date Threshold Target
(#) Maximum
(#) James M. Cracchiolo 2/4/2013 NA 33,011 66,022 $ 2,156,000 23,108 $ 1,509,200 166,967 $ 65.31 $ 3,018,400 Walter S. Berman 2/4/2013 NA 10,748 21,496 $ 702,000 7,524 $ 491,400 54,364 $ 65.31 $ 982,800 William F. Truscott 2/4/2013 NA 11,208 22,416 $ 732,000 7,845 $ 512,400 56,688 $ 65.31 $ 1,024,800 Donald E. Froude 2/4/2013 NA 6,982 13,964 $ 456,000 4,887 $ 319,200 35,314 $ 65.31 $ 638,400 Colin Moore 2/4/2013 NA $ 517,125 $ 1,034,250 $ 517,125 7,919 $ 517,125 38,141 $ 65.31 $ 689,500 Estimated Future
Payouts Under Equity
Incentive Plan Awards
and Performance
Awards(1) All Other
Stock Awards
(# of shares All Other
Option Awards
(# of
securities Exercise or
Base Price
of Option Grant Date Grant
Date Threshold Target
(#) Maximum
(#) of Stock
or Units)(2) Underlying
Options)(3) Awards
($/share)(4) Fair Value of
Awards ($)(5) 02/1/2016 NA 29,707 59,414 $ 2,608,000 18,567 $ 1,630,000 191,808 $ 87.79 $ 3,260,000 02/1/2016 NA 9,750 19,500 $ 856,000 6,094 $ 535,000 62,955 $ 87.79 $ 1,070,000 02/1/2016 NA 8,224 16,448 $ 722,000 5,137 $ 451,000 53,129 $ 87.79 $ 903,000 02/1/2016 NA 8,543 17,086 $ 750,000 5,342 $ 469,000 55,130 $ 87.79 $ 937,000 02/1/2016 NA 4,134 8,268 $ 363,000 2,585 $ 227,000 26,711 $ 87.79 $ 454,000 performance as described in our 2012 proxy statement.performance. The range in payout of performance shares/units is from 0 to 200% of target. For Mr. Moore, this represents the performance cash unit that he was awarded. (Note: in 2013, Mr. Moore received a long-term cash award rather than a performance share award since he was not a participant in the performance share award plan at time of award.)4, 20131, 2016 were: (i) an expected life of 5 years for each option; (ii) a dividend yield of 3.0%2.25%; (iii) an expected stock price volatility of 41.25%26.62%; and (iv) a risk-free rate of return of 0.882%1.329%.
Outstanding Equity Awards at Fiscal Year-End 201320162013.2016. Option Awards(3) Option Awards(3) Stock Awards(4) Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#) Stock Awards(4) Option
Grant
Date(1) Number of
Securities
Underlying
Unexercised
Option
Shares
Exercisable
(#) Number of
Securities
Underlying
Unexercised
Option
Shares
Unexercisable
(#) Equity
Incentive
Plan Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#) Option
Exercise
Price
($/Share) Option
Expiration
Date Restricted
Stock Grant
Date(1) Number of
Shares or
Units of
Stock
That Have
Not Vested
(#) Number of
Unearned
Performance
Share Units
of Stock
That Have
Not Vested
(#)(5) Market Value
of Shares or
Units of Stock
That Have
Not Vested
($)(6) 02/07/2011 176,343 (2) $ 58.7000 02/08/2021 02/07/2014 6,754 $ 749,289 Option
Grant
Date(1) Number of
Securities
Underlying
Unexercised
Options
Shares
Exercisable
(#) Number of
Securities
Underlying
Unexercised
Option
Shares
Unexercisable
(#) Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#) Option
Exercise
Price
($/Share) Option
Expiration
Date Restricted
Stock Grant
Date(1) Number of
Shares or
Units of
Stock
That Have
Not Vested
(#) Number of
Unearned
Performance
Share
Units of
Stock
That Have
Not Vested
(#)(5) Market Value
of Shares or
Units of Stock
That Have
Not Vested
($)(6) 02/06/2012 176,830 (2) $ 54.3300 02/07/2022 02/07/2014 21,327 $ 2,366,017 02/04/2013 166,967 (2) $ 65.3100 02/05/2023 02/02/2015 12,100 $ 1,342,374 James M. Cracchiolo 01/30/2007 457,999 (2) $ 58.7300 01/30/2017 02/07/2011 10,711 $ 1,232,301 01/29/2008 656,535 (2) $ 52.8600 01/29/2018 02/07/2011 33,901 $ 3,900,310 02/07/2014 112,874 56,439 $ 107.6100 02/07/2024 02/02/2015 19,105 $ 2,119,509 02/08/2010 187,994 (2) $ 37.2300 02/09/2020 02/06/2012 19,658 $ 2,261,653 02/02/2015 62,019 124,039 $ 128.7600 02/02/2025 02/01/2016 18,567 $ 2,059,823 02/07/2011 117,562 58,781 $ 58.7000 02/08/2021 02/06/2012 39,315 $ 4,523,191 02/01/2016 191,808 $ 87.7900 02/01/2026 02/01/2016 29,707 $ 3,295,695 02/07/2011 15,273 (2) $ 58.7000 02/08/2021 02/07/2014 2,190 $ 242,959 02/06/2012 58,943 117,887 $ 54.3300 02/07/2022 02/04/2013 23,108 $ 2,658,575 02/06/2012 57,342 (2) $ 54.3300 02/07/2022 02/07/2014 6,941 $ 770,035 02/04/2013 166,967 $ 65.3100 02/05/2023 02/04/2013 33,011 $ 3,797,916 02/04/2013 54,364 (2) $ 65.3100 02/05/2023 02/02/2015 3,935 $ 436,549
Walter S. Berman
01/30/2007
70,124
(2)
$
58.7300
01/30/2017
02/07/2011
3,356
$
386,108
01/29/2008 123,214 (2) $ 52.8600 01/29/2018 02/07/2011 10,630 $ 1,222,982 02/07/2014 36,606 18,304 $ 107.6100 02/07/2024 02/02/2015 6,213 $ 689,270 02/08/2010 54,419 (2) $ 37.2300 02/09/2020 02/06/2012 6,381 $ 734,134 02/02/2015 20,168 40,338 $ 128.7600 02/02/2025 02/01/2016 6,094 $ 676,068 02/07/2011 36,848 18,425 $ 58.7000 02/08/2021 02/06/2012 12,755 $ 1,467,463 02/01/2016 62,955 $ 87.7900 02/01/2026 02/01/2016 9,750 $ 1,081,665 02/07/2011 62,989 (2) $ 58.7000 02/08/2021 02/07/2014 2,190 $ 242,959 02/06/2012 19,114 38,228 $ 54.3300 02/07/2022 02/04/2013 7,524 $ 865,636 02/06/2012 60,323 (2) $ 54.3300 02/07/2022 02/07/2014 6,941 $ 770,035 02/04/2013 54,364 $ 65.3100 02/05/2023 02/04/2013 10,748 $ 1,236,557 02/04/2013 56,688 (2) $ 65.3100 02/05/2023 02/02/2015 3,832 $ 425,122
William F. Truscott
01/30/2007
70,124
(2)
$
58.7300
01/30/2017
02/07/2011
3,828
$
440,411
01/29/2008 155,357 (2) $ 52.8600 01/29/2018 02/07/2011 12,112 $ 1,393,486 02/07/2014 36,606 18,304 $ 107.6100 02/07/2024 02/02/2015 6,679 $ 740,968 02/08/2010 64,313 (2) $ 37.2300 02/09/2020 02/06/2012 6,700 $ 770,835 02/02/2015 19,624 39,250 $ 128.7600 02/02/2025 02/01/2016 5,137 $ 569,899 02/07/2011 41,992 20,997 $ 58.7000 02/08/2021 02/06/2012 13,418 $ 1,543,741 02/01/2016 53,129 $ 87.7900 02/01/2026 02/01/2016 8,224 $ 912,371 05/03/2010 13,195 (2) $ 47.5000 05/04/2020 02/07/2014 2,072 $ 229,868 02/06/2012 20,107 40,216 $ 54.3300 02/07/2022 02/04/2013 7,845 $ 902,567 02/06/2012 12,239 (2) $ 54.3300 02/07/2022 02/07/2014 6,765 $ 750,509 02/04/2013 56,688 $ 65.3100 02/05/2023 02/04/2013 11,208 $ 1,289,480 02/04/2013 25,428 (2) $ 65.3100 02/05/2023 02/02/2015 3,552 $ 394,059
Donald E. Froude
10/01/2008
72,941
(2)
$
38.8300
10/02/2018
02/07/2011
2,289
$
263,349
02/08/2010 26,385 (2) $ 37.2300 02/09/2020 02/07/2011 7,240 $ 832,962 02/07/2014 34,638 17,320 $ 107.6100 02/07/2024 02/02/2015 7,106 $ 788,340 02/07/2011 25,126 12,565 $ 58.7000 02/08/2021 02/06/2012 4,196 $ 482,750 02/02/2015 18,218 36,437 $ 128.7600 02/02/2025 02/01/2016 5,342 $ 592,641 02/06/2012 12,620 25,240 $ 54.3300 02/07/2022 02/06/2012 8,411 $ 967,686 02/01/2016 55,130 $ 87.7900 02/01/2026 02/01/2016 8,543 $ 947,760 02/07/2011 22,726 (2) $ 58.7000 02/08/2021 02/07/2014 991 $ 109,942 02/04/2013 35,314 $ 65.3100 02/05/2023 02/04/2013 4,887 $ 562,249 02/06/2012 22,848 (2) $ 54.3300 02/07/2022 02/07/2014 3,159 $ 350,459 02/04/2013 6,982 $ 803,279 02/04/2013 24,162 (2) $ 65.3100 02/05/2023 02/02/2015 1,786 $ 198,139
Colin Moore
05/03/2010
13,195
$
47.5000
05/04/2020
05/03/2010
2,634
$
303,042
02/07/2011 10,369 $ 58.7000 02/08/2021 02/07/2011 2,834 $ 326,052 02/07/2014 16,568 8,285 $ 107.6100 02/07/2024 02/02/2015 2,819 $ 312,740 02/06/2012 12,237 24,476 $ 54.3300 02/07/2022 02/06/2012 6,122 $ 704,336 02/02/2015 9,155 18,311 $ 128.7600 02/02/2025 02/01/2016 2,585 $ 286,780 02/04/2013 38,141 $ 65.3100 02/05/2023 02/04/2013 7,919 $ 911,081 02/01/2016 26,711 $ 87.7900 02/01/2026 02/01/2016 4,134 $ 458,626 Vesting ScheduleRemainingVesting Dates5/03/2010 25.00% vests each year for four years beginning one year from date of grantVesting Schedule 05/03/2014Remaining Vesting Dates2/07/2011
33.33% vests each year for three years beginning one year from date of grant
02/07/201420172/06/2012
33.33% vests each year for three years beginning one year from date of grant
02/06/2014,02/2017, and 02/06/201502/20182/04/2013
33.33% vests each year for three years beginning one year from date of grant
02/04/2014,
01/2017, 02/04/2015,01/2018, and 02/04/201601/2019
Grant DateVesting ScheduleRemainingVesting Dates5/03/2010 25.00% vests each year for four years beginning one year from date of grantVesting Schedule 05/03/2014Remaining Vesting Dates2/07/2011
33.33% vests each year for three years beginning one year from date of grant
02/07/201420172/06/2012
33.33% vests each year for three years beginning one year from date of grant
02/06/2014,02/2017, and 02/06/201502/20182/04/2013
33.33% vests each year for three years beginning one year from date of grant
02/04/2014,01/2017, 02/04/2015,01/2018, and 02/04/201601/2019
20132016 will vest on December 31, 2015,the payout date in February 2019), and are subject to the achievement of the established performance measures. PayoutPayouts may range from 0% to 200% of target.$115.05$110.94 on December 31, 2013.2016.
Option Exercises and Stock Vested in 201320162013.2016. Option Awards Stock Awards Option Awards Stock Awards Performance Share Units Number of Shares
Acquired on Exercise
(#) Value Realized
on Exercise
($) Number of RSAs
Acquired on Vesting
(#) Value Realized
on Vesting
($)(5) Number of
Shares Acquired
on Exercise
(#) Value
Realized
on
Exercise
($) Number of
RSAs
Acquired on
Vesting
(#) Value
Realized
on Vesting
($)(5) Number of
RSAs
Acquired on
Vesting
(#) Value
Realized
on Vesting
($)(5) 6,050 (1) $ 507,837 (i) 66,022 (4) $ 5,465,961 (iii) 7,704 (2) $ 658,461 (ii) 100,000 $ 3,126,500 9,828 (1) $ 654,643 (i) 100,000 $ 3,144,500 10,709 (2) $ 708,186 (ii) 6,752 (3) $ 558,998 (iv) 1,967 (1) $ 165,110 (i) 21,496 (4) $ 1,779,654 (iii) 200,000 $ 6,315,000 25,517 (3) $ 1,696,625 (iii) 2,508 (2) $ 214,359 (ii) 128,531 $ 6,130,929 2,190 (3) $ 181,310 (iv) 1,915 (1) $ 160,745 (i) 22,416 (4) $ 1,855,821 (iii) 100,000 $ 4,769,000 2,615 (2) $ 223,504 (ii) 100,000 $ 4,901,000 2,190 (3) $ 181,310 (iv) 1,775 (1) $ 148,994 (i) 100,000 $ 5,354,000 2,641 (2) $ 225,726 (ii) 100,000 $ 3,303,500 2,072 (3) $ 171,541 (iv) 893 (1) $ 74,958 (i) 9,554 (4) $ 790,976 (iii) 65,267 $ 2,199,172 1,116 (2) $ 95,385 (ii) 100,000 $ 3,434,500 991 (3) $ 82,045 (iv) 100,000 $ 3,714,500 100,000 $ 3,788,500 100,000 $ 3,994,500 45,886 $ 3,201,007 54,114 $ 3,774,993 100,000 $ 6,987,000 100,000 $ 8,250,000 126,055 $ 4,441,548 3,190 (1) $ 212,486 (i) 100,000 $ 5,530,000 3,356 (2) $ 221,932 (ii) 32,563 $ 2,248,801 7,387 (3) $ 491,162 (iii) 71,091 $ 3,323,149 200,000 $ 8,836,904 3,349 (1) $ 223,077 (i) 88,863 $ 2,931,146 3,827 (2) $ 253,080 (ii) 127,773 $ 8,641,288 8,730 (3) $ 580,458 (iii) 40,000 $ 1,957,200 2,098 (1) $ 139,748 (i) 20,000 $ 1,359,400 2,288 (2) $ 151,305 (iii) 19,979 $ 1,403,525 8,058 (3) $ 535,776 (iii) 26,388 $ 703,768 3,061 (1) $ 203,893 (i) 20,738 $ 320,817 2,833 (2) $ 187,346 (ii) 13,194 $ 451,103 2,631 (4) $ 199,430 (iv)
For Mr. Cracchiolo: a total of 9,8286,050 shares vested, 5,0962,987 of these shares were withheld to cover taxes, and a net of 4,7323,063 shares were delivered.
For Mr. Berman: a total of 3,1901,967 shares vested, 1,646969 of these shares were withheld to cover taxes, and a net of 1,544998 shares were delivered.
For Mr. Truscott: a total of 3,3491,915 shares vested, 1,595864 of these shares were withheld to cover taxes, and a net of 1,7541,051 shares were delivered.
For Mr. Froude:Moore: a total of 2,0981,775 shares vested, 1,052794 of these shares were withheld to cover taxes, and a net of 1,046981 shares were delivered.
For Mr. Moore:Sweeney: a total of 3,061893 shares vested, 1,470409 of these shares were withheld to cover taxes, and a net of 1,591484 shares were delivered.
For Mr. Cracchiolo: a total of 10,7097,704 shares vested, 5,5533,875 of these shares were withheld to cover taxes, and a net of 5,1563,829 shares were delivered.
For Mr. Berman: a total of 3,3562,508 shares vested, 1,6831,235 of these shares were withheld to cover taxes, and a net of 1,6731,273 shares were delivered.
For Mr. Truscott: a total of 3,8272,615 shares vested, 1,8231,184 of these shares were withheld to cover taxes, and a net of 2,0041,431 shares were delivered.
For Mr. Froude:Moore: a total of 2,2882,641 shares vested, 1,1481,181 of these shares were withheld to cover taxes, and a net of 1,1401,460 shares were delivered.
For Mr. Sweeney: a total of 1,116 shares vested, 552 of these shares were withheld to cover taxes, and a net of 564 shares were delivered.
For Mr. Moore: a total of 2,833 shares vested, 1,361 of these shares were withheld to cover taxes, and a net of 1,472 shares were delivered.
For Mr. Cracchiolo: a total of 25,5176,752 shares vested, 13,2313,205 of these shares were withheld to cover taxes, and a net of 12,2863,547 shares were delivered.
For Mr. Berman: a total of 7,3872,190 shares vested, 3,6361,078 of these shares were withheld to cover taxes, and a net of 3,7511,112 shares were delivered.
For Mr. Truscott: a total of 8,7302,190 shares vested, 4,158979 of these shares were withheld to cover taxes, and a net of 4,5721,211 shares were delivered.
For Mr. Froude:Moore: a total of 8,0582,072 shares vested, 4,041927 of these shares were withheld to cover taxes, and a net of 4,0171,145 shares were delivered.
For Mr. Moore:Sweeney: a total of 2,631991 shares vested, 1,264475 of these shares were withheld to cover taxes, and a net of 1,367516 shares were delivered.
For Mr. Cracchiolo: a total of 66,022 shares vested, 34,233 of these shares were withheld to cover taxes, and a net of 31,789 shares were delivered.
For Mr. Berman: a total of 21,496 shares vested, 11,086 of these shares were withheld to cover taxes, and a net of 10,410 shares were delivered.
For Mr. Truscott: a total of 22,416 shares vested, 10,640 of these shares were withheld to cover taxes, and a net of 11,776 shares were delivered.
For Mr. Sweeney: a total of 9,554 shares vested, 4,794 of these shares were withheld to cover taxes, and a net of 4,760 shares were delivered.
Mr. Moore did not participate in the performance share plan at the time these awards were granted.
(i)
(ii)
(iii)
(iv)
Non-Qualified Deferred Compensation for 20132016
This table provides information about the Ameriprise Financial Deferred Compensation Plan. A named executive officer may only participate in the plan if he or she elects to defer receipt of compensation that would otherwise be payable in cash. All named executive officers except for Mr. Moore elected to participate in the plan for the 20132016 performance year.
The amounts shown in the column "Executive Contributions" come from a deferral of the named executive officer's cash incentive award. If the named executive officer had not chosen to defer these amounts, we would have paid these amounts in cash. The amounts shown in this column are part of the dollar amount shown in the Summary Compensation Table on page 70,54, in the column "Non-Equity Incentive Plan Compensation" for 2013.2016.The amount shown in the column "Executive Contributions" is not an additional award to the named executive officer.
| Executive Contributions(1) | Company Contributions(2) | Aggregate Earnings in Last Fiscal Year(3) | Aggregate Withdrawals/ Distributions in Last Fiscal Year(4) | Aggregate Balance as of December 31, 2013(5) | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
James M. Cracchiolo | $ | 2,178,000 | $ | 544,500 | $ | 7,331,259 | $ | 0 | $ | 24,468,218 | ||||||
Walter S. Berman | $ | 706,400 | $ | 176,600 | $ | 2,133,297 | $ | 0 | $ | 7,452,941 | ||||||
William F. Truscott | $ | 706,400 | $ | 176,600 | $ | 312,675 | $ | 0 | $ | 2,386,591 | ||||||
Donald E. Froude | $ | 486,200 | $ | 110,500 | $ | 1,469,531 | $ | (911,681 | ) | $ | 2,632,448 | |||||
Colin Moore | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||
Executive Contributions(1) | Company Contributions(2) | Aggregate Earnings in Last Fiscal Year(3) | Aggregate Withdrawals/ Distributions in Last Fiscal Year(4) | Aggregate Balance as of December 31, 2016(5) | ||||||||||||||
| | | | | | | | | | | | | | | | | | |
James M. Cracchiolo | $ | 1,251,600 | $ | 312,900 | $ | 3,195,485 | $ | 0 | $ | 35,896,249 | ||||||||
| | |||||||||||||||||
Walter S. Berman | $ | 448,600 | $ | 112,150 | $ | 794,608 | $ | 193,186 | $ | 10,278,095 | ||||||||
| | |||||||||||||||||
William F. Truscott | $ | 352,800 | $ | 88,200 | $ | 163,881 | $ | 771,945 | $ | 3,386,300 | ||||||||
| | |||||||||||||||||
Colin Moore | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||
| | |||||||||||||||||
Joseph E. Sweeney | $ | 200,000 | $ | 50,000 | $ | 72,628 | $ | 328,986 | $ | 1,650,649 | ||||||||
| | | | | | | | | | | | | | | | | | |
The following table presents information about the participation of our named executive officers in our retirement programs. Assumptions used for purposes of valuation are included in the footnotes.
| Plan | Number of Years Credited Service | Present Value of Accumulated Benefits(1) | Payments Made During Fiscal 2013 | ||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
James M. Cracchiolo | Retirement Plan | 31 | $ | 553,154 | $ | 0 | ||||||
Supplemental Retirement Plan | 31 | $ | 7,108,378 | $ | 0 | |||||||
Total | 31 | $ | 7,661,532 | $ | 0 | |||||||
Walter S. Berman | Retirement Plan | 45 | $ | 390,480 | $ | 0 | ||||||
Supplemental Retirement Plan | 45 | $ | 2,361,904 | $ | 0 | |||||||
Total | 45 | $ | 2,752,384 | $ | 0 | |||||||
William F. Truscott | Retirement Plan | 12 | $ | 166,231 | $ | 0 | ||||||
Supplemental Retirement Plan | 12 | $ | 1,829,419 | $ | 0 | |||||||
Total | 12 | $ | 1,995,650 | $ | 0 | |||||||
Donald E. Froude | Retirement Plan | 5 | $ | 57,446 | $ | 0 | ||||||
Supplemental Retirement Plan | 5 | $ | 411,007 | $ | 0 | |||||||
Total | 5 | $ | 468,453 | $ | 0 | |||||||
Colin Moore | Retirement Plan | 11 | $ | 43,718 | $ | 0 | ||||||
Supplemental Retirement Plan | 11 | $ | 479,101 | $ | 0 | |||||||
Total | 11 | $ | 522,819 | $ | 0 | |||||||
Plan | Number of Years Credited Service | Present Value of Accumulated Benefits(1) | Payments Made During Fiscal 2016 | |||||||||||
| | | | | | | | | | | | | | |
James M. Cracchiolo | Retirement Plan | 34 | $ | 697,419 | $ | 0 | ||||||||
| | | | | | |||||||||
Supplemental Retirement Plan | 34 | $ | 11,547,837 | $ | 0 | |||||||||
| | | | | | |||||||||
Total | 34 | $ | 12,245,256 | $ | 0 | |||||||||
| | | | | | | | | | | | | | |
Walter S. Berman | Retirement Plan | 48 | $ | 537,653 | $ | 0 | ||||||||
| | | | | | |||||||||
Supplemental Retirement Plan | 48 | $ | 4,028,445 | $ | 0 | |||||||||
| | | | | | |||||||||
Total | 48 | $ | 4,566,098 | $ | 0 | |||||||||
| | | | | | | | | | | | | | |
William F. Truscott | Retirement Plan | 15 | $ | 230,074 | $ | 0 | ||||||||
| | | | | | |||||||||
Supplemental Retirement Plan | 15 | $ | 2,759,069 | $ | 0 | |||||||||
| | | | | | |||||||||
Total | 15 | $ | 2,989,143 | $ | 0 | |||||||||
| | | | | | | | | | | | | | |
Colin Moore | Retirement Plan | 14 | $ | 86,037 | $ | 0 | ||||||||
| | | | | | |||||||||
Supplemental Retirement Plan | 14 | $ | 1,035,819 | $ | 0 | |||||||||
| | | | | | |||||||||
Total | 14 | $ | 1,121,856 | $ | 0 | |||||||||
| | | | | | | | | | | | | | |
Joseph E. Sweeney | Retirement Plan | 33 | $ | 564,538 | $ | 0 | ||||||||
| | | | | | |||||||||
Supplemental Retirement Plan | 33 | $ | 1,677,345 | $ | 0 | |||||||||
| | | | | | |||||||||
Total | 33 | $ | 2,241,883 | $ | 0 | |||||||||
| | | | | | | | | | | | | | |
Previous Table
Previous Table | Applicable Percentage | ||||||||||
| | | | | |||||||
Less than 35 | 2.50 | % | |||||||||
| | ||||||||||
35-44 | 3.25 | ||||||||||
| |||||||||||
45-59 | 4.25 | ||||||||||
| |||||||||||
60-74 | 5.75 | ||||||||||
| |||||||||||
75-89 | 8.00 | ||||||||||
| |||||||||||
90 or more | 10.00 | ||||||||||
| | | | |
New Table (effective March 1, 2010)
New Table (effective March 1, 2010) | |||||||
Applicable Percentage | |||||||
| | | | | |||
Less than 5 | 2.50 | % | |||||
| |||||||
5-9 | 3.25 | ||||||
| |||||||
10-14 | 4.00 | ||||||
| | ||||||
15 and over | 5.00 | ||||||
| | | | |
rate is 5%. The maximum rate is the lower of 10% or a specific rate set by the U.S. government under the tax laws. For 2012,2016, the interest rate was 5%.
The retirement plan balances vest after completing three years of service, reaching age 65, or upon disability or death.
The retirement plan account balances for Messrs. Cracchiolo, Berman, Truscott, FroudeMoore and MooreSweeney as of December 31, 20132016 were $503,187; $390,480; $147,715; $53,500;$651,019; $537,653; $209,467; $80,244; and $39,737,$511,226, respectively. The supplemental retirement plan account balances for Messrs. Cracchiolo, Berman, Truscott, Moore and Froude and MooreSweeney as of December 31, 20132016 were $6,495,148; $2,319,370; $1,642,073; $382,332;$10,417,997; $3,917,478; $2,422,255; $933,601; and $437,502,$1,464,003, respectively. For all of the named executive officers, their retirement plan or supplemental retirement plan balances are fully vested. The December 31, 20132016 values shown in the table above for the retirement plan assumes a discount rate of 3.95%3.88% and a discount rate of 4.20%3.78% for the supplemental retirement plan. The values assume an interest crediting rate of 5.00% and a retirement age of 65, or current age for Mr. Berman, for both the retirement plan and the supplemental retirement plan.
Potential Payments Upon Termination or Change of Control for Named Executive Officers
The tables belowon the following pages describe the potential termination payments for the named executive officers under various termination of employment scenarios as if they occurred on December 31, 2013.2016. As noted earlier, the Company does not have employment, severance or change in control agreements with any of the named executive officers. Rather, the rights of our executives with respect to specific events, including death, disability, severance or retirement, or a change in control of the Company, are covered by certain compensation and benefit plans of the Company, the material terms of which are summarized below.
We are providing two sets of tables for each named executive officer to show you what the officer would receive if he or she no longer worked for the Company. The first table shows the vested plan amounts that the named executive officer would receive if he or she left the Company for any reason. Any other employee participating in these plans would also receive any vested amounts in these plans if he or she no longer worked for the Company. The second table shows what the named executive officer would receive under various hypothetical situations resulting in a termination of his or her employment. The second table does not include amounts disclosed in the first table.
Both tables assume that the named executive officer's employment terminated on December 31, 2013.2016. Because the numbers disclosed are calculated as of that date and are subject to other estimates and assumptions, the actual amounts the named executive officer may receive may differ materially from those shown in the tables. Additional information on the calculations for the payouts are outlined in the common set of footnotes to the tables. Unless otherwise specified in the common set of footnotes to the tables, all payments and benefits would be provided by Ameriprise Financial, Inc.
In addition to the amounts disclosed in these tables, the named executive officer would also receive any restricted stock that vested on or before his or her termination date. The officer would also be able to exercise any vested stock options. For more information, please see the Outstanding Equity Awards at Fiscal Year-End 20122016 table on page 73.57.
Ameriprise Financial Senior Executive Severance Plan. To be eligible for severance benefits under this Plan,plan, a named executive officer must be terminated in connection with a workforce reduction, closure, or other similar event. Additionally, an employee who is involuntarily or constructively terminated within two years after a Changechange in Control (as described in the Plan and summarized below)control is eligible for severance benefits. The severance amount is based upon a multiple of (i) the named executive officer's annual base compensation plus (ii) the average bonus and incentive amount over the previous three years. The named executive officer also is entitled to the bonus amount that he or she otherwise would have received for the year in which the termination occurred, pro-rated for the period of employment during that year. During the severance period, medical and dental benefits will continue and we have the right to continue other programs.
The severance amount is payable in installments according to our regular payroll schedule, except that the payments which would be made during the sixth month period following termination will be made in a lump sum on the first payroll period of the seventh month following termination. If the named executive officer is reemployed by us, he or she must repay any severance amounts paid and forfeit any severance amounts not yet paid to the extent that those amounts relate to the portion of the severance period after the date of reemployment.
In addition, a named executive officer who incurs an involuntary or constructive termination within two years after a Changechange in Controlcontrol will have a credit made to his or her book reserve account in the Ameriprise Financial Supplemental Retirement Plan as of the date of termination equal to the value of employer contributions that would have been made to the Ameriprise Financial Retirement Plan, the
Ameriprise Financial 401(k) Plan, the Ameriprise Financial Supplemental Retirement Plan, or other similar plans during the period for which the employee receives severance payments under this Plan.
A Changechange in Controlcontrol under the Senior Executive Severance Plan generally occurs if an unrelated person or entity acquires at least 30% of the voting power of our securities, an unrelated person or entity acquires at least 50% of the total voting power of our
securities and at least 50% of the total fair market value of our equity or assets, or a majority of our Board is replaced during any 12-month period with persons whose appointment or election is not endorsed by a majority of our Board before the date of appointment or election.
A constructive termination occurs if, within two years after a change in control, a named executive officer resigns or otherwise terminates employment without consent for any of the following reasons: (i) a reduction in overall total compensation opportunity; (ii) relationrelocation to a location more than 35 miles from the named executive officer's primary residence and more than 50 miles from the named executive officer's then current work location; or (iii) a significant reduction in the named executive officer's position, title, duties, or responsibilities. To constitute a constructive termination, the named executive officer must provide the Company with a thirty-day period to remedy the situation.
Beginning in 2012, the gross-up provisions for excise taxes were eliminated and replaced with a best net approach, under which a named executive officer will receive reduced severance benefits if it results in a more favorable after-tax benefit for the officer.
Accelerated Vesting of Equity Compensation. We eliminated the "single-trigger" acceleration of unvested incentive compensation upon a change in control for future awards of equity compensation granted on or after January 1, 2013. Instead, the vesting of awards granted on or after January 1, 2013, will only accelerate upon a "double-trigger" (change in control followed by termination for good reason or involuntary termination not for cause within two years).
Annual Cash Incentive Compensation. A pro rata annual cash incentive award may become payable in the event an executive is involuntarily or constructively terminated within two years of a change in control. The pro rata payment of these awards rewards the executive for performance prior to the change in control of his or her performance prior to the change in control transactions.
Detrimental Conduct Agreements. To help protect our competitive position, the named executive officers have signed detrimental conduct agreements. Detrimental conduct includes: working for certain competitors; soliciting our customers or employees; and disclosing confidential information for a period of up to one year after termination of employment. The detrimental conduct agreements include a provision that requires the named executive officers to forfeit or repay the proceeds from some or all of their long-term incentive awards received up to two years prior to the end of their employment if they engage in conduct that is detrimental to us. In addition, the severance and post-employment benefits described above require the named executive officer to sign an agreement that includes a general release and other restrictive covenants, in addition to the detrimental conduct agreement. The detrimental conduct agreement was updated in November 2014 to reflect the current competitive environment and applicable laws. Key provisions of the policy, including the repayment terms, were not changed. The revisions generally provide more details about the noncompete and nonsoliciation provisions, and also address the enforceability in a few states with different employment laws.
James M. Cracchiolo. The following tables describe the potential termination payments for Mr. Cracchiolo for the various termination of employment scenarios, assuming separation of employment on December 31, 2013.These tables reflect the 2013 changes in our plans.2016. These amounts are in addition to the payout of vested stock options and restricted stock awards listed on page 75.58.
Vested Plan Balances Payable Upon Termination of Employment for any Reason(1)
| | | | | ||||
Retirement Plan | $ | 503,187 | $ | 651,019 | ||||
| | | ||||||
401(k) Plan | $ | 2,380,065 | $ | 2,921,682 | ||||
| | | ||||||
Supplemental Retirement Plan | $ | 6,997,178 | $ | 11,015,158 | ||||
| | | ||||||
Deferred Compensation Plan | $ | 24,468,218 | $ | 35,896,249 | ||||
| | | | | ||||
Total | $ | 34,348,647 | $ | 50,484,108 | ||||
| | | | |
| Other Amounts Payable Upon Termination of Employment | Other Amounts Payable Upon Termination of Employment | ||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
| Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | ||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
Severance benefit(2) | $ | 0 | $ | 0 | $ | 19,540,667 | $ | 29,311,000 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 19,444,000 | $ | 29,166,000 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Payment of annual cash incentive award(3) | $ | 10,890,000 | $ | 0 | $ | 10,890,000 | $ | 7,785,500 | $ | 10,890,000 | $ | 10,890,000 | $ | 6,258,000 | $ | 0 | $ | 6,258,000 | $ | 9,916,500 | $ | 6,258,000 | $ | 6,258,000 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of long-term performance share unit awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 8,181,742 | $ | 12,221,416 | $ | 12,221,416 | $ | 0 | $ | 0 | $ | 0 | $ | 4,877,588 | $ | 4,877,588 | $ | 4,877,588 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of stock options(4) | $ | 0 | $ | 0 | $ | 0 | $ | 18,775,347 | $ | 18,775,347 | $ | 18,775,347 | $ | 0 | $ | 0 | $ | 0 | $ | 4,628,297 | $ | 4,628,297 | $ | 4,628,297 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of restricted stock awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 6,152,529 | $ | 6,152,529 | $ | 6,152,529 | $ | 0 | $ | 0 | $ | 0 | $ | 4,151,486 | $ | 4,151,486 | $ | 4,151,486 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Continued contributions to supplemental retirement plan(5) | $ | 0 | $ | 0 | $ | 0 | $ | 2,383,880 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 2,373,780 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of deferred compensation plan match(6) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Continued participation in health and welfare benefits(7) | $ | 0 | $ | 0 | $ | 21,456 | $ | 32,184 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 25,490 | $ | 38,235 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Payout of life insurance benefits(8) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 2,450,000 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 2,500,000 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Present value of disability benefits(9) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,615,181 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,242,628 | $ | 0 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
Total | $ | 10,890,000 | $ | 0 | $ | 30,452,123 | $ | 72,622,182 | $ | 49,654,473 | $ | 50,489,292 | $ | 6,258,000 | $ | 0 | $ | 25,727,490 | $ | 55,151,886 | $ | 21,157,999 | $ | 22,415,371 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | |
Walter S. Berman. The following tables describe the potential termination payments for Mr. Berman for the various termination of employment scenarios, assuming separation of employment on December 31, 2013.These tables reflect the 2013 changes in our plans.2016. These amounts are in addition to the payout of vested stock options and restricted stock awards listed on page 75.58.
Vested Plan Balances Payable Upon Termination of Employment for any Reason(1)
| | | | | ||||
Retirement Plan | $ | 390,480 | $ | 537,653 | ||||
| | | ||||||
401(k) Plan | $ | 468,436 | $ | 655,260 | ||||
| | | ||||||
Supplemental Retirement Plan | $ | 2,405,124 | $ | 4,016,550 | ||||
| | | ||||||
Deferred Compensation Plan | $ | 7,452,941 | $ | 10,278,095 | ||||
| | | | | ||||
Total | $ | 10,716,981 | $ | 15,487,558 | ||||
| | | | |
| Other Amounts Payable Upon Termination of Employment | Other Amounts Payable Upon Termination of Employment | ||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
| Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | ||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
Severance benefit(2) | $ | 0 | $ | 0 | $ | 5,268,500 | $ | 10,537,000 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 5,371,500 | $ | 10,743,000 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Payment of annual cash incentive award(3) | $ | 3,532,000 | $ | 0 | $ | 3,532,000 | $ | 2,527,500 | $ | 3,532,000 | $ | 3,532,000 | $ | 2,243,000 | $ | 0 | $ | 2,243,000 | $ | 3,237,500 | $ | 2,243,000 | $ | 2,243,000 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of long-term performance share unit awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 2,613,476 | $ | 3,927,002 | $ | 3,927,002 | $ | 0 | $ | 0 | $ | 0 | $ | 1,590,103 | $ | 1,590,103 | $ | 1,590,103 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of stock options(4) | $ | 0 | $ | 0 | $ | 0 | $ | 6,063,518 | $ | 6,063,518 | $ | 6,063,518 | $ | 0 | $ | 0 | $ | 0 | $ | 1,518,361 | $ | 1,518,361 | $ | 1,518,361 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of restricted stock awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 1,985,878 | $ | 1,985,878 | $ | 1,985,878 | $ | 0 | $ | 0 | $ | 0 | $ | 1,355,576 | $ | 1,355,576 | $ | 1,355,576 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Continued contributions to supplemental retirement plan(5) | $ | 0 | $ | 0 | $ | 0 | $ | 1,092,700 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,114,800 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of deferred compensation plan match(6) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Continued participation in health and welfare benefits(7) | $ | 0 | $ | 0 | $ | 15,692 | $ | 31,385 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 18,684 | $ | 37,369 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Payout of life insurance benefits(8) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 650,000 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 675,000 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Present value of disability benefits(9) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
Total | $ | 3,532,000 | $ | 0 | $ | 8,816,192 | $ | 24,851,457 | $ | 15,508,398 | $ | 16,158,398 | $ | 2,243,000 | $ | 0 | $ | 7,633,184 | $ | 19,596,709 | $ | 6,707,040 | $ | 7,382,040 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | |
William F. Truscott. The following tables describe the potential termination payments for Mr. Truscott for the various termination of employment scenarios, assuming separation of employment on December 31, 2013.These tables reflect the 2013 changes in our plans.2016. These amounts are in addition to the payout of vested stock options and restricted stock awards listed on page 75.58.
Vested Plan Balances Payable Upon Termination of Employment for any Reason(1)
| | | | | ||||
Retirement Plan | $ | 147,715 | $ | 209,467 | ||||
| | | ||||||
401(k) Plan | $ | 577,471 | $ | 756,335 | ||||
| | | ||||||
Supplemental Retirement Plan | $ | 1,783,169 | $ | 2,599,041 | ||||
| | | ||||||
Deferred Compensation Plan | $ | 1,854,755 | $ | 3,386,300 | ||||
| | | | | ||||
Total | $ | 4,363,110 | $ | 6,951,143 | ||||
| | | | |
| Other Amounts Payable Upon Termination of Employment | ||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | |||||||||||||
Severance benefit(2) | $ | 0 | $ | 0 | $ | 5,388,000 | $ | 10,776,000 | $ | 0 | $ | 0 | |||||||
Payment of annual cash incentive award(3) | $ | 0 | $ | 0 | $ | 3,532,000 | $ | 2,647,000 | $ | 3,532,000 | $ | 3,532,000 | |||||||
Accelerated vesting of long-term performance share unit awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 2,852,473 | $ | 4,226,707 | $ | 4,226,707 | |||||||
Accelerated vesting of stock options(4) | $ | 0 | $ | 0 | $ | 0 | $ | 6,444,758 | $ | 6,444,758 | $ | 6,444,758 | |||||||
Accelerated vesting of restricted stock awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 2,113,814 | $ | 2,113,814 | $ | 2,113,814 | |||||||
Continued contributions to supplemental retirement plan(5) | $ | 0 | $ | 0 | $ | 0 | $ | 523,920 | $ | 0 | $ | 0 | |||||||
Accelerated vesting of deferred compensation plan match(6) | $ | 0 | $ | 0 | $ | 0 | $ | 531,835 | $ | 531,835 | $ | 531,835 | |||||||
Continued participation in health and welfare benefits(7) | $ | 0 | $ | 0 | $ | 31,240 | $ | 62,479 | $ | 0 | $ | 0 | |||||||
Payout of life insurance benefits(8) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 2,600,000 | |||||||
Present value of disability benefits(9) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,851,471 | $ | 0 | |||||||
Total | $ | 0 | $ | 0 | $ | 8,951,240 | $ | 25,952,280 | $ | 18,700,585 | $ | 19,449,114 | |||||||
Donald E. Froude. The following tables describe the potential termination payments for Mr. Froude for the various termination of employment scenarios, assuming separation of employment on December 31, 2013.These tables reflect the 2013 changes in our plans. These amounts are in addition to the payout of vested stock options and restricted stock awards listed on page 75.
Vested Plan Balances Payable Upon Termination of Employment for any Reason(1)
Retirement Plan | $ | 53,500 | ||
401(k) Plan | $ | 430,576 | ||
Supplemental Retirement Plan | $ | 382,332 | ||
Deferred Compensation Plan | $ | 2,299,674 | ||
Total | $ | 3,166,082 | ||
| Other Amounts Payable Upon Termination of Employment | Other Amounts Payable Upon Termination of Employment | ||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
| Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | ||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
Severance benefit(2) | $ | 0 | $ | 0 | $ | 3,585,500 | $ | 4,780,667 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 4,872,500 | $ | 9,745,000 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Payment of annual cash incentive award(3) | $ | 0 | $ | 0 | $ | 2,210,000 | $ | 1,655,500 | $ | 2,210,000 | $ | 2,210,000 | $ | 1,764,000 | $ | 0 | $ | 1,764,000 | $ | 2,978,000 | $ | 1,764,000 | $ | 1,764,000 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of long-term performance share unit awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 1,745,845 | $ | 2,603,927 | $ | 2,603,927 | $ | 0 | $ | 0 | $ | 0 | $ | 1,568,137 | $ | 1,568,137 | $ | 1,568,137 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of stock options(4) | $ | 0 | $ | 0 | $ | 0 | $ | 3,997,129 | $ | 3,997,129 | $ | 3,997,129 | $ | 0 | $ | 0 | $ | 0 | $ | 1,290,889 | $ | 1,290,889 | $ | 1,290,889 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of restricted stock awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 1,308,349 | $ | 1,308,349 | $ | 1,308,349 | $ | 0 | $ | 0 | $ | 0 | $ | 1,237,979 | $ | 1,237,979 | $ | 1,237,979 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Continued contributions to supplemental retirement plan(5) | $ | 0 | $ | 0 | $ | 0 | $ | 229,178 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 527,750 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of deferred compensation plan match(6) | $ | 0 | $ | 0 | $ | 0 | $ | 332,774 | $ | 332,774 | $ | 332,774 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Continued participation in health and welfare benefits(7) | $ | 0 | $ | 0 | $ | 15,608 | $ | 20,811 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 33,715 | $ | 67,429 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Payout of life insurance benefits(8) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 2,550,000 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 675,000 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Present value of disability benefits(9) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,332,899 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,543,755 | $ | 0 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
Total | $ | 0 | $ | 0 | $ | 5,811,108 | $ | 14,070,253 | $ | 11,785,078 | $ | 13,002,179 | $ | 1,764,000 | $ | 0 | $ | 6,670,215 | $ | 17,415,184 | $ | 7,404,760 | $ | 6,536,005 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | |
Colin Moore. The following tables describe the potential termination payments for Mr. Moore for the various termination of employment scenarios, assuming separation of employment on December 31, 2013.These tables reflect the 2013 changes in our plans.2016. These amounts are in addition to the payout of vested stock options and restricted stock awards listed on page 75.58.
Vested Plan Balances Payable Upon Termination of Employment for any Reason(1)
| | | | | ||||
Retirement Plan | $ | 39,737 | $ | 80,244 | ||||
| | | ||||||
401(k) Plan | $ | 0 | $ | 0 | ||||
| | | ||||||
Supplemental Retirement Plan | $ | 437,502 | $ | 933,601 | ||||
| | | ||||||
Deferred Compensation Plan | $ | 0 | $ | 0 | ||||
| | | | | ||||
Total | $ | 477,239 | $ | 1,013,845 | ||||
| | | | |
| Other Amounts Payable Upon Termination of Employment | Other Amounts Payable Upon Termination of Employment | ||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
| Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | ||||||||||||||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
Severance benefit(2) | $ | 0 | $ | 0 | $ | 5,701,625 | $ | 7,602,167 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 4,556,000 | $ | 6,074,667 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Payment of annual cash incentive award(3) | $ | 0 | $ | 0 | $ | 3,340,000 | $ | 3,394,125 | $ | 3,340,000 | $ | 3,340,000 | $ | 1,912,000 | $ | 0 | $ | 1,912,000 | $ | 2,887,500 | $ | 1,912,000 | $ | 1,912,000 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of long-term performance share unit awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,591,989 | $ | 1,591,989 | $ | 1,591,989 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of stock options(4) | $ | 0 | $ | 0 | $ | 0 | $ | 4,858,931 | $ | 4,858,931 | $ | 4,858,931 | $ | 0 | $ | 0 | $ | 0 | $ | 1,333,935 | $ | 1,333,935 | $ | 1,333,935 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of restricted stock awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 2,244,510 | $ | 2,244,510 | $ | 2,244,510 | $ | 0 | $ | 0 | $ | 0 | $ | 1,216,568 | $ | 1,216,568 | $ | 1,216,568 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Continued contributions to supplemental retirement plan(5) | $ | 0 | $ | 0 | $ | 0 | $ | 330,087 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 303,733 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Accelerated vesting of deferred compensation plan match(6) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Continued participation in health and welfare benefits(7) | $ | 0 | $ | 0 | $ | 21,855 | $ | 29,140 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 22,346 | $ | 29,794 | $ | 0 | $ | 0 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Payout of life insurance benefits(8) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 2,125,000 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 2,375,000 | ||||||||||||||
| | | ||||||||||||||||||||||||||||||||||||
Present value of disability benefits(9) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,624,308 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,254,378 | $ | 0 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | | |||||||||||||||||||
Total | $ | 0 | $ | 0 | $ | 9,063,480 | $ | 18,458,960 | $ | 12,067,749 | $ | 12,568,441 | $ | 1,912,000 | $ | 0 | $ | 6,490,346 | $ | 13,438,186 | $ | 7,308,870 | $ | 8,429,492 | ||||||||||||||
| | | | | | | | | | | | | | | | | | | |
Joseph E. Sweeney. The following tables describe the potential termination payments for Mr. Sweeney for the various termination of employment scenarios, assuming separation of employment on December 31, 2016. These amounts are in addition to the payout of vested stock options and restricted stock awards listed on page 58.
Vested Plan Balances Payable Upon Termination of Employment for any Reason(1)
| | | | |
Retirement Plan | $ | 511,226 | ||
| | |||
401(k) Plan | $ | 1,311,308 | ||
| | |||
Supplemental Retirement Plan | $ | 1,497,678 | ||
| | |||
Deferred Compensation Plan | $ | 1,650,649 | ||
| | | | |
Total | $ | 4,970,861 | ||
| | | | |
Other Amounts Payable Upon Termination of Employment | |||||||||||||||||||
| | | | | | | | | | | | | | | | | | | |
Voluntary Termination/ Retirement | For Cause Termination | Involuntary Not for Cause Termination | Involuntary or Good Reason Termination following a Change in Control(10) | Termination Due to Disability | Termination Due to Death | ||||||||||||||
| | | | | | | | | | | | | | | | | | | |
Severance benefit(2) | $ | 0 | $ | 0 | $ | 2,754,000 | $ | 5,508,000 | $ | 0 | $ | 0 | |||||||
| | ||||||||||||||||||
Payment of annual cash incentive award(3) | $ | 1,000,000 | $ | 0 | $ | 1,000,000 | $ | 1,429,000 | $ | 1,000,000 | $ | 1,000,000 | |||||||
| | ||||||||||||||||||
Accelerated vesting of long-term performance share unit awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 711,828 | $ | 711,828 | $ | 711,828 | |||||||
| | ||||||||||||||||||
Accelerated vesting of stock options(4) | $ | 0 | $ | 0 | $ | 0 | $ | 645,949 | $ | 645,949 | $ | 645,949 | |||||||
| | ||||||||||||||||||
Accelerated vesting of restricted stock awards(4) | $ | 0 | $ | 0 | $ | 0 | $ | 594,860 | $ | 594,860 | $ | 594,860 | |||||||
| | ||||||||||||||||||
Continued contributions to supplemental retirement plan(5) | $ | 0 | $ | 0 | $ | 0 | $ | 481,140 | $ | 0 | $ | 0 | |||||||
| | ||||||||||||||||||
Accelerated vesting of deferred compensation plan match(6) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||
| | ||||||||||||||||||
Continued participation in health and welfare benefits(7) | $ | 0 | $ | 0 | $ | 26,322 | $ | 52,645 | $ | 0 | $ | 0 | |||||||
| | ||||||||||||||||||
Payout of life insurance benefits(8) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 550,000 | |||||||
| | ||||||||||||||||||
Present value of disability benefits(9) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1,601,109 | $ | 0 | |||||||
| | | | | | | | | | | | | | | | | | | |
Total | $ | 1,000,000 | $ | 0 | $ | 3,780,322 | $ | 9,423,422 | $ | 4,553,746 | $ | 3,502,637 | |||||||
| | | | | | | | | | | | | | | | | | | |
(i.e., following a six-month delay), not exceeding the duration during which the executive is entitled to receive severance benefits under the plan.
employment. The hypothetical amount shown in the table is based on the average of the actual cash incentive awards earned for 20112014 and 2012.
Related Person Transaction Review Policy
Our Audit Committee has adopted a written policy which provides procedures for the review, approval or ratification of certain transactions required to be reported under applicable rules of the Securities and Exchange Commission. Any amendments to the policy require Audit Committee approval.
Reportable transactions include those in which we are a participant and in which a related person has a direct or indirect interest. Related persons include: our directors, director nominees and executive officers; any person known by us to be the beneficial owner of more than five percent of our voting securities; and certain family members of, or certain other persons sharing the household of, any of our directors, director nominees or executive officers or holders of more than five percent of our voting securities.
Standards to be applied to the review of related person transactions include, but are not limited to, the following:
The Audit Committee of our Board of Directors, as well as the Audit Committee's chairman acting alone under delegated authority, have the responsibility to review, approve, disapprove or ratify related person transactions. Any Audit Committee member who is a related person under a transaction that is the subject of review is recused from voting upon any approval, disapproval or ratification of that transaction. Conditions operative to the transaction or to the relationship with the related person may be included in an approval or ratification.
Transactions with Other Companies
In the usual course of our business, we have transactions with many other firms. Some of the directors or officers of these firms may also serve as directors or officers for us or our subsidiaries. We carry out our transactions with these firms on customary terms. The directors and officers who serve us, our subsidiaries or the other firms involved may not have knowledge of these transactions.
Transactions Between the Company and Our Directors and Officers
Our executive officers and directors may from time to time take out loans from certain of our subsidiaries on the same terms that these subsidiaries offer to the general public. By way of example, our broker-dealerbroker- dealer subsidiary Ameriprise Financial Services, Inc. may extend margin loans (except margin loans to acquire the Company's stock) to our directors and executive officers under their brokerage accounts. All indebtedness from these transactions is in the ordinary course of our business and is on the same terms, including interest rates, in effect for comparable transactions with other people. Such
indebtedness involves normal risks of collection and does not have features or terms that are unfavorable to our subsidiaries.
Our executive officers and directors may also have transactions with us or our subsidiaries involving other goods and services, such as insurance, brokerage and investment services. These transactions are also in the usual course of our business and we provide them on terms that we offer to our employees (with respect to executive officers) or to the public (with respect to our outside directors) generally.
Transactions with Significant Shareholders
From time to time we may engage in ordinary course relationships and commercial transactions with our significant shareholders or their subsidiaries. We do not believe that these transactions are material to our Company.
In the usual course of our advice and wealth management business, we provide to FMR LLC or its affiliates (Fidelity) distribution services and marketing support in connection with the sale of Fidelity products to our clients. We received approximately $11.6 million in marketing support and related payments from Fidelity in 2013 in connection with these services.
In the usual course of our asset management business, we obtain investment advisory or sub-advisory services from Fidelity. We paid approximately $4.3 million in fees to Fidelity in 2013 in connection with these investment advisory or sub-advisory services.
In the usual course of our asset management business, we provide advisory and sub-advisory services in connection with certain plans and products offered by JPMorgan. We received approximately $1.9 million in fees from JPMorgan in 2013 in connection with these investment advisory or sub-advisory services.
In the usual course of our asset management and risk management activities, we have entered into various option, swap and other derivative contracts with JPMorgan. The aggregate fair market value of agreements outstanding at December 31, 2013 was ($391) million, which amount was fully collateralized.
In the usual course of our asset management activities, we own or manage the various debt securities of our significant shareholders and their affiliates. At December 31, 2013, these holdings included: $594 million par amount of debt securities issued by JPMorgan; and approximately $4 million par amount of debt securities issued by BlackRock.
In connection with our 2013 offerings of senior notes due 2023, JPMorgan participated as a member of the underwriting syndicates and received a pro rata share of underwriting fees payable in connection with such offerings. We paid approximately $944 thousand in underwriting fees to JPMorgan for these services.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires our directors, executive officers, and persons who own more than ten percent of a registered class of our equity securities to file with us, the Securities and Exchange Commission, and the New York Stock Exchange initial reports of ownership and reports of changes in ownership of any of the Company's equity securities. As is true at many other public companies, our directors and executive officers have signed powers of attorney delegating the authority and obligation to prepare, sign, and file Section 16 reports on their behalf to employees of the Company. With respect to 2013,2016, to the best of our knowledge, all required reports were filed on a timely basis, except as follows. explained in the next paragraph.
The attorney-in-fact responsible for filing Section 16 reports for Ms. McGrawMr. Sharpe filed onethree late report for one 401(k) intra-plan transaction. With respect to reports due before 2013, as a result of administrative errors the attorney-in-fact responsible for filing reports for the following executive officers filed the numberfour transactions in our stock. Each of late reports indicated in parentheses after each name: Mses. Hunter (3) and Sharan (2); and Messrs. Froude (1); Maglaque (1); Sweeney (1); Truscott (2); and Woerner (3). In each case, the report involved the conversionthese transactions was a purchase of deferred stock units into common stock and the withholding ofeffected by a portion of the shares to pay taxes, all of which were reportedbroker in a Form 4 fileddiscretionary account without the knowledge of Mr. Sharpe or the attorney-in-fact. ln total, 180 shares were purchased in 2014. In making this disclosure, we have relied in part on the written representationsthese transactions.
Requirements, Including Deadlines, for Submission of Proxy Proposals, Nomination of Directors and Other Business Byby Shareholders
Under the Securities and Exchange Commission rules,Rule 14a-8, if a shareholder wants us to include a proposal in our proxy statement and form of proxy for the 20152018 annual meeting of shareholders, our corporate secretary must receive the proposal at his office by 5:00 p.m. Central time onno later than November 19, 2014.17, 2017. Proposals that are mailed, faxed, emailed or otherwise delivered to anyone other than our corporate secretary must still be received by the corporate secretary no later than 5:00 p.m. Central timeNovember 17, 2017. Under our By-laws, shareholders must submit such proposals to the Company directly and may not authorize anyone else to act as such stockholder's proxy for the purpose of submitting such proposals to the Company on November 19, 2014.their behalf.
Under our By-Laws, and as the Securities and Exchange Commission rules permit, shareholders must follow certain procedures to nominate a person for election as a director at an annual or special meeting, or to introduce an item of business at an annual meeting. Under these procedures, shareholders must submit the proposed nominee or item of business by delivering a written notice to the corporate secretary of the Company at our principal executive offices. Our corporate secretary must receive notice as follows no later than 5:00 p.m. Central time on the date specified:
we must receive notice pertaining to the 20152018 annual meeting no earlier than December 31, 2014,27, 2017, and no later than January 30, 2015.
Any notice that is mailed, faxed, emailed or otherwise delivered to anyone other than our corporate secretary must still be received by the corporate secretary no later than 5:00 p.m. Central time on the relevant date specified above.
Our By-Laws require a nominee to deliver signed forms of a questionnaire, representation, and agreement that our corporate secretary will provide upon request. A notice of a proposed item of business must include a description of and the reasons for bringing the proposed business to the annual meeting, any material interest of the shareholder in the business and certain other information about the shareholder.
The Board and our management have not received notice of, and are not aware of, any business to come before the meeting other than the items we refer to in this proxy statement. If any other matter comes before the meeting, the named proxies will use their best judgment in voting the proxies.
* * * *
We have made available on the Internet our 20132016 Annual Report to Shareholders in connection with this proxy solicitation.If you would like a copy of our 20132016 Form 10-K, excluding certain exhibits, please contact Thomas R. Moore, Vice President, Corporate Secretary and Chief Governance Officer, Ameriprise Financial, Inc., 1098 Ameriprise Financial Center, Minneapolis, Minnesota 55474. We will provide a copy without charge.
Please submit your proxy by telephone or onlineInternet or sign, date and return your proxy card or voting instruction form in the prepaid envelope you received if you requested paper copies of our proxy materials. We encourage you to attend the April 30, 2014,26, 2017, meeting. To attend the 20142017 annual meeting, you must have been a shareholder as of the record date of March 4, 2014,February 28, 2017, and you will need to bring an admission ticket. You may be asked to provide valid
photo identification. You must print an admission ticket atwww.proxyvote.com. You will need the 12-digit control number printed on your Notice of Internet Availability of Proxy Materials, votervoting instruction form or proxy card.
If you are a shareholder who plans to send a proxy or qualified representative to represent you at the annual meeting, it is also important to note that under our amended and restated By-Laws, the following provisions apply: (i) no later than five business days prior to the annual meeting, a shareholder who has proposed business or made a nomination in accordance with the amended and restated By-Laws for consideration at the annual meeting must provide the full name(s) and current residential address of any person(s) authorized to act as a proxy or qualified representative for such shareholder in order for such qualified representative to gain admission to the annual meeting;meeting to present the proposed business or nomination on such shareholder's behalf; and (ii) no more than three persons who are authorized to act as proxy or a qualified representative for a shareholder may attend the annual meeting. You should review Article I, Section 1.10(c) of our By-Laws for additional information. We have posted our amended and restated By-Laws on our website on the Corporate Governance page atir.ameriprise.com.
If you are attending the meeting as a proxy or qualified representative of a shareholder, please bring a form of identification bearing your photograph and written evidence of your authority to act on behalf of the shareholder, bearing the shareholder's signature.
Please note that seating is limited, and admission is on a first-come, first servedfirst-served basis. No cameras, cellular telephones, pagers, or other electronic or recording devices will be allowed to be used in the meeting room.
By order of Anyone attending the annual meeting must observe the rules approved by the Board of Directors, which are printed in the meeting agenda.
By order of the Board of Directors, | ||
THOMAS R. MOORE |
Appendix –
GAAP to Non-GAAP Reconciliations
($ in millions) | Full Year 2012 | Full Year 2013 | Full Year 2016 | |||||||
---|---|---|---|---|---|---|---|---|---|---|
| | | | |||||||
Total net revenues | $ | 10,217 | $ | 11,199 | $ | 11,696 | ||||
| | |||||||||
Less: Revenue attributable to the CIEs | 71 | 345 | 128 | |||||||
Less: Net realized gains | 7 | 7 | ||||||||
Less: Integration/restructuring charges | (4 | ) | — | |||||||
| | |||||||||
Less: Net realized investment gains | 6 | |||||||||
| | |||||||||
Less: Market impact of hedges on investments | 3 | |||||||||
| | |||||||||
Less: Market impact on indexed universal life benefits | — | (10 | ) | 24 | ||||||
| | | | |||||||
Operating total net revenues | $ | 10,143 | $ | 10,857 | $ | 11,535 | ||||
| | | |
($ in millions, except per share amounts) | Full Year 2012 | Full Year 2013 | Per Diluted Share Full Year 2012 | Per Diluted Share Full Year 2013 | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Net income attributable to Ameriprise Financial | $ | 1,029 | $ | 1,334 | $ | 4.62 | $ | 6.44 | |||||
Less: Loss from discontinued operations, net of tax | (2 | ) | (3 | ) | (0.01 | ) | (0.02 | ) | |||||
Net income from continuing operations attributable to Ameriprise Financial | 1,031 | 1,337 | 4.63 | 6.46 | |||||||||
Less: Net realized gains, net of tax(1) | 5 | 5 | 0.02 | 0.02 | |||||||||
Add: Integration/restructuring charges, net of tax(1) | 46 | 9 | 0.21 | 0.04 | |||||||||
Add: Market impact on variable annuity guaranteed benefits, net of tax(1) | 173 | 111 | 0.77 | 0.53 | |||||||||
Add: Market impact on indexed universal life benefits, net of tax(1) | — | 8 | — | 0.04 | |||||||||
Operating earnings | $ | 1,245 | $ | 1,460 | $ | 5.59 | $ | 7.05 | |||||
($ in millions, except per share amounts) | Full Year 2016 | Per Diluted Share Full Year 2016 | ||||
| | | | | | |
Net income attributable to Ameriprise Financial | $ | 1,314 | $ | 7.81 | ||
| ||||||
Less: Net income (loss) attributable to the CIEs | (2) | (0.01) | ||||
| ||||||
Add: Integration/restructuring charges(1) | — | — | ||||
| ||||||
Add: Market impact on variable annuity guaranteed benefits(1) | 216 | 1.28 | ||||
| ||||||
Add: Market impact on indexed universal life benefits(1) | (36) | (0.21) | ||||
| ||||||
Add: Market impact of hedges on investments(1) | (3) | (0.02) | ||||
| ||||||
Add: Net realized investment (gains) losses(1) | (6) | (0.03) | ||||
| ||||||
Add: Tax effect of adjustments(2) | (60) | (0.36) | ||||
| | | | | | |
Operating earnings | $ | 1,427 | $ | 8.48 | ||
| | | | | | |
($ in millions) | Full Year 2012 | Full Year 2013 | Full Year 2016 | |||||||
---|---|---|---|---|---|---|---|---|---|---|
| | | | |||||||
Net income attributable to Ameriprise Financial | $ | 1,029 | $ | 1,334 | $ | 1,314 | ||||
Less: Loss from discontinued operations, net of tax | (2 | ) | (3 | ) | ||||||
Net income from continuing operations attributable to Ameriprise Financial | 1,031 | 1,337 | ||||||||
| | |||||||||
Less: Adjustments(1) | (214 | ) | (123 | ) | (113) | |||||
| | |||||||||
Operating earnings | $ | 1,245 | $ | 1,460 | $ | 1,427 | ||||
| | | | |||||||
Ameriprise Financial shareholders' equity(2) | $ | 9,071 | $ | 8,582 | $ | 6,877 | ||||
| | |||||||||
Less: Accumulated other comprehensive income, net of tax "AOCI"(2) | 1,001 | 821 | 426 | |||||||
| | | | |||||||
Ameriprise Financial shareholders' equity excluding AOCI(2) | 8,070 | 7,761 | 6,451 | |||||||
| | |||||||||
Less: Equity impacts attributable to the consolidated investment entities(2) | 397 | 333 | 27 | |||||||
| | | | |||||||
Operating equity(2) | $ | 7,673 | $ | 7,428 | $ | 6,424 | ||||
Return on equity from continuing operations, excluding AOCI | 12.8 | % | 17.2 | % | ||||||
| | | | |||||||
Return on equity, excluding AOCI | 20.4% | |||||||||
| | |||||||||
Operating return on equity, excluding AOCI(3) | 16.2 | % | 19.7 | % | 22.2% | |||||
| | | |
of hedges to offset interest rate changes on unrealized gains or losses for certain investments; integration/restructuring charges; the impact of consolidating certain investment entities; and discontinued operations in the numerator, and Ameriprise Financial shareholders' equity excluding AOCI and the impact of consolidating investment entities using a five-point average of quarter-end equity in the denominator. After-tax is calculated using the statutory tax rate of 35%.
($ in millions) | Full Year 2016(1) | ||
| | | |
Advice & Wealth Management and Asset Management pretax operating earnings | $ | 1,532 | |
| |||
Less: Unlocking | — | ||
| | | |
Advice & Wealth Management and Asset Management pretax operating earnings excluding unlocking | $ | 1,532 | |
| | | |
Annuities and Protection pretax operating earnings | $ | 505 | |
| |||
Less: Unlocking | (235) | ||
| | | |
Annuities and Protection pretax operating earnings excluding unlocking | $ | 740 | |
| | | |
Percent pretax operating earnings from Advice & Wealth Management and Asset Management | 75% | ||
Percent pretax operating earnings from Annuities and Protection | 25% | ||
| |||
Percent pretax operating earnings from Advice & Wealth Management and Asset Management excluding unlocking | 67% | ||
| |||
Percent pretax operating earnings from Annuities and Protection excluding unlocking | 33% | ||
| | | |
($ in millions) | Full Year 2014 | Full Year 2015 | ||||
| | | | | | |
Net income attributable to Ameriprise Financial | $ | 1,619 | $ | 1,562 | ||
| ||||||
Less: Loss from discontinued operations, net of tax | (2) | — | ||||
| | | | | | |
Net income from continuing operations attributable to Ameriprise Financial | 1,621 | 1,562 | ||||
| ||||||
Add: Integration/restructuring charges(1) | — | 5 | ||||
| ||||||
Add: Market impact on variable annuity guaranteed benefits(1) | 94 | 214 | ||||
| ||||||
Add: Market impact on indexed universal life benefits(1) | 6 | 1 | ||||
| ||||||
Add: Market impact of hedges on investments(1) | — | 21 | ||||
| ||||||
Add: Net realized investment (gains) losses(1) | (37) | (4) | ||||
| ||||||
Add: Tax effect of adjustments(2) | (22) | (83) | ||||
| | | | | | |
Operating earnings | $ | 1,662 | $ | 1,716 | ||
| | | | | | |
Table*** Exercise Your Right to Vote *** Important Notice Regarding the Availability of Contents
Exhibit A — Proposed Amended and Restated Certificate ofIncorporationProxy Materials for the Shareholder Meeting to Effect Amendments, as Explained In Item 3
AMENDED AND RESTATEDCERTIFICATE OF INCORPORATIONOF
Be Held on April 26, 2017. AMERIPRISE FINANCIAL, INC.
April 30, 2014
The present name the annual meeting and vote in person, please call 612-678-0106. You are receiving this communication because you hold shares in the company named above. This is not a ballot. You cannot use this notice to vote these shares. This communication presents only an overview of CORPORATE SECRETARY'S OFFICE 1098 AMERIPRISE FINANCIAL CENTER MINNEAPOLIS, MN 55474 the more complete proxy materials that are available to you on the Internet. You may view the proxy materials online at www.proxyvote.com or easily request a paper copy (see reverse side). We encourage you to access and review all of the corporation isimportant information contained in the proxy materials before voting. proxy materials and voting instructions. E18732-P86555 See the reverse side of this notice to obtain Meeting Information Meeting Type: Annual Meeting For holders as of: February 28, 2017 Date: April 26, 2017 Time: 11:00 a.m., CT Location: Ameriprise Financial, Inc. The corporation was incorporated under707 Second Avenue South Minneapolis, Minnesota 55474 For information on how to obtain directions to be able to attend
Before You Vote How to Access the name "Amex Acquisition Corporation"Proxy Materials Have the information that is printed in the box marked by the filingarrow XXXX XXXX XXXX XXXX (located on the by the arrow XXXX XXXX XXXX XXXX (located on the following page) in the subject line. How To Vote Please Choose One of its original Certificatethe Following Voting Methods XXXX XXXX XXXX XXXX (located on the following page) available and follow the instructions. XXXX XXXX XXXX XXXX (located on the following page) available and follow the instructions. E18733-P86555 Vote In Person: Many shareholder meetings have attendance requirements including, but not limited to, the possession of Incorporationan attendance ticket issued by the entity holding the meeting. Please check the meeting materials for any special requirements for meeting attendance. At the meeting, you will need to request a ballot to vote these shares. Vote Online: Before The Meeting: Go to www.proxyvote.com. Have the information that is printed in the box marked by the arrow During The Meeting: Go to ir.ameriprise .com. Have the information that is printed in the box marked by the arrow Vote By Mail: You can vote by mail by requesting a paper copy of the materials, which will include a proxy card. Shareholder Meeting Registration: To vote and/or attend the meeting, go to the "Register for Meeting" link at www.proxyvote.com. Proxy Materials Available to VIEW or RECEIVE: NOTICE AND PROXY STATEMENT ANNUAL REPORT How to View Online: following page) and visit: www.proxyvote.com. How to Request and Receive a PAPER or E-MAIL Copy: If you want to receive a paper or e-mail copy of these documents, you must request one. There is NO charge for requesting a copy. Please choose one of the following methods to make your request: 1) BY INTERNET: www.proxyvote.com 2) BY TELEPHONE: 1-800-579-1639 3) BY E-MAIL*: sendmaterial@proxyvote.com * If requesting materials by e-mail, please send a blank e-mail with the Secretary of State of the State of Delaware on September 29, 1983. This Amended and Restated Certificate of Incorporation of the corporation, which restates and integrates and also further amends the provisions of the corporation's Certificate of Incorporation, was duly adopted in accordance with the provisions of Sections 242 and 245 of the General Corporation Law of the State of Delaware. The Certificate of Incorporation of the corporationinformation that is hereby amended, integrated and restated to read in its entirety as follows:
The name of the Corporation is Ameriprise Financial, Inc.
The registered office of the Corporationprinted in the State of Delaware is Corporation Trust Center, 1209 Orange Street, inbox marked Requests, instructions and other inquiries sent to this e-mail address will NOT be forwarded to your investment advisor. Please make the City of Wilmington, 19801, County of New Castle. The name of the Corporation's registered agent is The Corporation Trust Company.request as instructed above on or before April 12, 2017 to facilitate timely delivery.
The purpose of the Corporation is to engage in any lawful act or activity for which a corporation may be organized under the DGCL.
Section 1. Authorized Stock. The aggregate number of shares of stock that the Corporation shall have authority to issue is 1,275,000,000, consisting of 1,250,000,000 shares of common stock, par value $.01 per share (the "Common Stock"), and 25,000,000 shares of preferred stock, par value $.01 per share (the "Preferred Stock"). The number of authorized shares of the Common Stock and the Preferred Stock or any other class of stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the combined voting power of the outstanding shares of stock of the Corporation entitled to vote thereon, and, irrespective of Section 242(b)(2) of the DGCL, no vote of the holders of any of the Common Stock, the Preferred Stock or any other class of stock, voting separately as a class, shall be required therefor.
Section 2. Preferred Stock.
(a) The Preferred Stock may be issued at any time and from time to time in one or more series. The Board of Directors is hereby authorizedrecommends you vote FOR each of the following director nominees: 1. Election of Directors The Board of Directors recommends you vote FOR the following proposal: 1a. James M. Cracchiolo 2. To approve the compensation of the named executive officers by a nonbinding advisory vote. 1b. Dianne Neal Blixt The Board of Directors recommends you vote 1 year on the following proposal: 1c. Amy DiGeso 3. To approve a nonbinding advisory vote on the frequency of shareholder approval of the compensation of the named executive officers. 1d. Lon R. Greenberg 1e. Siri S. Marshall The Board of Directors recommends you vote FOR the following proposal: 1f. Jeffrey Noddle 4. To ratify the Audit Committee's selection of PricewaterhouseCoopers LLP as the Company's independent registered public accounting firm for 2017. 1g. H. Jay Sarles NOTE: Such other business as may properly come before the meeting or any adjournment or postponement thereof. 1h. Robert F. Sharpe, Jr. 1i. Christopher J. Williams E18734-P86555 Voting Items
E18735-P86555
VOTE ONLINE Before The Meeting - Go to providewww.proxyvote.com Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m. Eastern time the day before the cut-off date or meeting date. Participants in the Ameriprise Financial 401(k) Plan have an earlier voting deadline, described on the reverse side. Have your proxy card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form. During The Meeting - Go to ir.ameriprise.com ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs we incur to mail proxy materials, you can consent to receive all future proxy statements, proxy cards and annual reports electronically via e-mail or online. To sign up for electronic delivery, please follow the instructions above to vote online and, when prompted, indicate that you agree to receive or access proxy materials online. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. Eastern time the day before the meeting date. Participants in the 401(k) Plan have an earlier voting deadline, described on the reverse side. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. CORPORATE SECRETARY'S OFFICE 1098 AMERIPRISE FINANCIAL CENTER MINNEAPOLIS, MN 55474 SHAREHOLDER MEETING REGISTRATION: To vote and/or attend the meeting, go to the "Register for Meeting" link at www.proxyvote.com. TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: E18717-P86555 KEEP THIS PORTION FOR YOUR RECORDS DETACH AND RETURN THIS PORTION ONLY THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. AMERIPRISE FINANCIAL, INC. The Board of Directors recommends you vote FOR each of the following director nominees: For ! ! ! ! ! ! ! ! ! Against ! ! ! ! ! ! ! ! ! Abstain ! ! ! ! ! ! ! ! ! 1. Election of Directors 1a. James M. Cracchiolo 1b. Dianne Neal Blixt The Board of Directors recommends you vote FOR the following proposal: For Against Abstain ! 2 Years ! 3 Years ! Abstain 1c. Amy DiGeso 2. To approve the compensation of the named executive officers by a nonbinding advisory vote. 1d. Lon R. Greenberg The Board of Directors recommends you vote 1 year on the following proposal: 1 Year ! ! ! ! 3. To approve a nonbinding advisory vote on the frequency of shareholder approval of the compensation of the named executive officers. 1e. Siri S. Marshall 1f. Jeffrey Noddle The Board of Directors recommends you vote FOR the following proposal: For Against Abstain 1g. H. Jay Sarles ! ! ! 1h. Robert F. Sharpe, Jr. 4. To ratify the Audit Committee's selection of PricewaterhouseCoopers LLP as the Company's independent registered public accounting firm for 2017. 1i. Christopher J. Williams NOTE: Such other business as may properly come before the meeting or any adjournment or postponement thereof. Note: Please sign as your name appears printed above. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee or guardian, please give full title. Signature (Joint Owners) Date Signature [PLEASE SIGN WITHIN BOX] Date V.1.1
Important Notice Regarding the Availability of Proxy Materials for the issuance of shares of Preferred Stock in seriesAnnual Meeting: The Annual Report and by filing a certificate of designation pursuant to the applicable provisions of the DGCL (hereinafter referred to as a "Preferred Stock Certificate of Designation"), to establish from time to time the number of shares to be included in each such series,Notice and to fix the designation, powers, preferences and rights of shares of each such series and the qualifications, limitations and restrictions thereof.
(b) The authorityProxy Statement are available at www.proxyvote.com. E18718-P86555 AMERIPRISE FINANCIAL, INC. Proxy Solicited on Behalf of the Board of Directors for the Annual Meeting of Shareholders on Wednesday, April 26, 2017 The undersigned hereby appoints Walter S. Berman, Karen Wilson Thissen and Thomas R. Moore, or any one of them, proxies or proxy, with full power of substitution, to vote all common shares of Ameriprise Financial, Inc. which the undersigned is entitled to vote at the Annual Meeting of Shareholders to be held at Ameriprise Financial, Inc. headquarters at 707 Second Avenue South, Minneapolis, Minnesota 55474, on Wednesday, April 26, 2017, at 11:00 a.m., Central time, and at any adjournment(s) or postponement(s) of the meeting, as indicated on the reverse side of this proxy card, with respect to each series of Preferred Stock shall include, but not be limited to, determinationthe proposals set forth in the proxy statement, and in their discretion, upon any matter that may properly come before the meeting or any adjournment(s) or postponement(s) of the following:
(c) The Common Stock shall be subject to the express terms of the Preferred Stock and any series thereof.
(d) Except as otherwise required by law, holders of Common Stock, as such, shall not be entitled to vote on any amendment to this Amended and Restated Certificate of Incorporation or to a Preferred Stock Certificate of Designation that alters or changes the powers, preferences, rights or other terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other series of Preferred Stock, to vote thereon as a separate class pursuant to this Amended and Restated Certificate of Incorporation or a Preferred Stock Certificate of Designation or pursuant to the DGCL as currently in effect or as the same may hereafter be amended.
Section 3. Voting in Election of Directors. Except as may be required by law or as provided in this Amended and Restated Certificate of Incorporation or in a Preferred Stock Certificate of Designation, holders of Common Stock shall have the exclusive right to vote for the election of Directors and for all other purposes, and holders of Preferred Stock shall not be entitled to vote on any matter or receive notice of any meeting of stockholders.
Section 4. Owner. The Corporation shall be entitled to treat the person in whose name any share of its stock is registered as the owner thereof for all purposes and shall not be bound to recognize any equitable or other claim to, or interest in, such share on the part of any other person, whether or not the Corporation shall have notice thereof, except as expressly provided by applicable law.
ARTICLE VBOARD OF DIRECTORS; MANAGEMENT OF THE CORPORATION
The following provisions are inserted for the management of the business and for the conduct of the affairs of the Corporation and for the purpose of creating, defining, limiting and regulating the powers of the Corporation and its Directors and stockholders:
(a) Subject to the rights of any holders of any series of Preferred Stock, if any, to elect additional Directors under specified circumstances, the holders of a majority of the combined voting power of the then outstanding stock of the Corporation entitled to vote generally in the election of Directors may remove any Director or the entire Board of Directors with or without cause.
(b) Vacancies in the Board of Directors resulting from death, resignation, retirement, disqualification, removal from office or other cause and newly created Directorships resulting from any increase in the authorized number of Directors shall be filled in the manner provided in the By-Laws of the Corporation.
(c) Advance notice of nominations for the election of Directors shall be given in the manner and to the extent provided in the By-Laws of the Corporation.
(d) The election of Directors may be conducted in any manner approved by the Board of Directors at the time when the election is held and need not be by written ballot.
(e) All corporate powers and authority of the Corporation (except as at the time otherwise provided by law, by this Amended and Restated Certificate of Incorporation or by the By-Laws) shall be vested in and exercised by the Board of Directors.
(f) The Board of Directors shall have the power without the assent or vote of the stockholders to adopt, amend, alter or repeal the By-Laws of the Corporation.
ARTICLE VILIABILITY OF DIRECTORS
Section 1. General. No Director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages for breach of his or her fiduciary duty as a Director, except to the
extent that such exemption from liability or limitation thereof is not permitted under the DGCL as currently in effect or as the same may hereafter be amended.
Section 2. Repeal or Modification. Any repeal or modification of this Article VI by the stockholders of the Corporation shall not adversely affect any right or protection of a Director, officer or the Corporation existing at the time of such repeal or modification. If the General Corporation Law of the State of Delaware is amended after the filing of this Amended and Restated Certificate of Incorporation to authorize corporate action further eliminating or limiting the personal liability of Directors, then the liability of a Director of the Corporation shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended.
ARTICLE VIINO STOCKHOLDER ACTIONS BY WRITTEN CONSENT
Any action required or permitted to be taken by the stockholders of the Corporation must be effected at a duly called annual or special meeting of the stockholders of the Corporation, and the ability of the stockholders to consent in writing to the taking of any action is specifically denied.
The Corporation reserves the right to amend or repeal any provision contained in this Amended and Restated Certificate of Incorporation in the manner now or hereafter prescribed by the laws of the State of Delaware, and all rights herein conferred upon stockholders or Directors (in the present form of this Amended and Restated Certificate of Incorporation or as hereinafter amended) are granted subject to this reservation; provided, however, that any amendment or repeal of Article VI of this Amended and Restated Certificate of Incorporation shall not adversely affect any right or protection existing hereunder immediately prior to such amendment or repeal.
* * * * * *
Exhibit B — Ameriprise Financial 2005 Incentive Compensation Plan, as Amended and Restated, as Explained in Item 4
AMERIPRISE FINANCIAL2005 INCENTIVE COMPENSATION PLAN(As Amended and Restated Effective April 30, 2014)
The Plan is intended to promote the interests of the Company and its stockholders by providing the eligible employees, non-employee directors and independent contractors of the Company, who are largely responsible for the management, growth and protection of the business of the Company, with incentives and rewards to encourage them to continue in the service of the Company. The Plan is designed to meet this intent by providing such eligible persons with a proprietary interest in pursuing the long-term growth, profitability and financial success of the Company.
As used in the Plan, the following definitions apply to the terms indicated below:
2.1 "Ameriprise Financial" means Ameriprise Financial, Inc., a Delaware corporation and any successor thereto.
2.2 "Award" means an Option, Stock Appreciation Right, Award of Restricted Stock, Award of Restricted Stock Units, Other Share-Based Award or Performance Award issued under the Plan.
2.3 "Award Agreement" means any written agreement or other instrument or document evidencing an Award under the Plan, including through an electronic medium.
2.4 "Board" means the board of directors of Ameriprise Financial.
2.5 "Code" means the Internal Revenue Code of 1986, as amended from time to time, and all regulations, interpretations and administrative guidance issued thereunder.
2.6 "Committee" means the Compensation and Benefits Committee of the Board or such other committee as the Board shall appoint from time to time to administer the Plan and to otherwise exercise and perform the authority and functions assigned to the Committee under the terms of the Plan. The Committee shall consist of no fewer than two Directors, each of whom is (a) a "non-employee director" within the meaning of Rule 16b-3 of the Exchange Act, (b) an "outside director" within the meaning of Section 162(m) of the Code, and (c) an "independent director" for purpose of the rules and regulations of the New York Stock Exchange (the "NYSE")(or such other principal securities market on which the Shares are traded).
2.7 "Company" means Ameriprise Financial and all of its Subsidiaries, collectively.
2.8 "Covered Employee" means an employee of the Company or its subsidiaries who is a "covered employee" within the meaning of Section 162(m) of the Code.
2.9 "Director" means a non-employee member of the Board.
2.10 "Dividend Equivalents" has the meaning set forth in Section 11.7.
2.11 "Employee" means any employee of the Company and any prospective employee conditioned upon, and effective not earlier than, such person becoming an employee of the Company.
2.12 "Exchange Act" means the Securities Exchange Act of 1934, as amended from time to time.
2.13 "Fair Market Value" means, with respect to the Shares as of any date, the per-Share closing price as reported on the NYSE composite tape on such date, or, if there is no such reported sale price of Shares on the NYSE composite tape on such date, then the per-Share closing price as reported on the NYSE composite tape on the last previous day on which sale price was reported on the NYSE composite tape, or such other value as determined by the Committee in accordance with applicable law. The Fair Market Value of any Shares (for purposes of Section 6.4(b)), and any property other than Shares shall be the market value of such property determined by such methods or procedures as shall be established from time to time by the Committee.
2.14 "Option" means any right granted to a Participant under the Plan allowing such Participant to purchase Shares at such price or prices and during such period or periods as the Committee shall determine.
2.15 "Other Share-Based Award" means any Award of Shares or other Award that is valued in whole or in part by reference to, or is otherwise based on, Shares.
2.16 "Participant" means an Employee, Director or independent contractor of the Company who is eligible to participate in the Plan and to whom one or more Awards have been granted pursuant to the Plan and, following the death of any such Person, his successors, heirs, executors and administrators, as the case may be.
2.17 "Payment Share" means Shares, Restricted Stock, Restricted Stock Units or Other Share-Based Awards granted solely in lieu of the cash payment of the employee-deferral portion (and the earnings on such portion) of a Participant's account under a nonqualified deferred compensation plan or similar arrangement of the Company, on a dollar-for-dollar basis based on the Fair Market Value of such Shares, Restricted Stock, Restricted Stock Units or Other Share-Based Awards at the time of payment; for the avoidance of doubt, a "Payment Share" shallnot include any grant made in payment of any Company contribution (or the earnings thereon) under a nonqualified deferred compensation plan or similar arrangement of the Company regardless of whether such payment is made in lieu of cash.
2.18 "Performance Award" means an Award granted under Section 9 contingent on the achievement of enumerated performance goals, pursuant to which the Participant may become entitled to receive cash, Shares or property, or other forms of payment, or any combination thereof, as determined by the Committee.
2.19 "Performance Period" means the period of time during which the performance goals under a Performance Award must be met.
2.20 "Person" means a "person" as such term is used in Sections 13(d) and 14(d) of the Exchange Act, including any "group" within the meaning of Section 13(d)(3) under the Exchange Act.
2.21 "Plan" means this Ameriprise Financial 2005 Incentive Compensation Plan, as it may be amended from time to time.
2.22 "Restricted Stock" means any Share issued with the restriction that the holder may not sell, transfer, pledge or assign such Share and with such other restrictions as the Committee, in its sole discretion, may impose, including any restriction on the right to vote such Share and the right to receive any dividends, which restrictions may lapse separately or in combination at such time or times, in installments or otherwise, as the Committee may deem appropriate.
2.23 "Restricted Stock Unit" means an Award that is valued by reference to a Share, which value may be paid to the Participant by delivery of such property as the Committee shall determine, including without limitation, cash or Shares, or any combination thereof, and that has such restrictions as the
Committee, in its sole discretion, may impose, including without limitation, any restriction on the right to retain such Awards, to sell, transfer, pledge or assign such Awards, or to receive any cash Dividend Equivalents with respect to such Awards, which restrictions may lapse separately or in combination at such time or times, in installments or otherwise, as the Committee may deem appropriate.
2.24 "Securities Act" means the Securities Act of 1933, as amended from time to time.
2.25 "Shares" means the shares of common stock of Ameriprise Financial, $0.01 par value per share, or any other security into which the common stock shall be changed pursuant to the adjustment provisions of Section 13.
2.26 "Stock Appreciation Right" means any right granted to a Participant pursuant to Section 7.
2.27 "Subsidiary" means any "subsidiary" within the meaning of Rule 405 under the Securities Act.
2.28 "Substitute Awards" means Awards granted or Shares issued by the Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards, in each case by a company acquired by the Company or with which the Company combines.
2.29 "Vesting Period" means the period of time specified by the Committee during which an Award is subject to vesting restrictions.
2.30 "Voting Securities" means, at any time, Ameriprise Financial's then outstanding voting securities.
3.1 Number of Shares.
(a) Subject to adjustment as provided in Section 13, a total of 54,400,000 Shares shall be authorized for issuance under the Plan. Of such total, as of April 30, 2014, no more than 4,500,000 Shares may be used for Awards other than Options or Stock Appreciation Rights.
(b) For purposes of counting Shares against the Share reserves under Section 3.1 (a): (i) Awards denominated solely in Shares (such as Options, Stock Appreciation Rights and Restricted Stock) and other Awards that may be exercised for or convertible into Shares will be counted against the reserve on the date of grant of the Award based on the maximum number of Shares underlying the Award; and (ii) Awards denominated other than in Shares that are exercisable for or convertible into Shares will be counted based on the number of Shares actually issued.
(c) If any Shares subject to an Award are forfeited, expire or otherwise terminate without issuance of such Shares, or any Award is settled for cash or otherwise does not result in the issuance of all or a portion of the Shares subject to such Award, such Shares shall, to the extent of such forfeiture, expiration, termination, cash settlement or non-issuance, again be available for issuance under the Plan. Shares tendered or withheld by the Company to satisfy tax withholding requirements upon the vesting of Awards other than Options and Stock Appreciation Rights shall also become available for issuance under the Plan.
(d) For the avoidance of doubt, in the event that (i) any Option is exercised through the tendering of Shares (either actually or by attestation) or by the withholding of Shares by the Company, (ii) withholding tax liabilities arising from the exercise of an Option or Stock Appreciation Right other Award are satisfied by the tendering of Shares (either actually or by attestation) or by the withholding of Shares by the Company or (iii) any Shares are purchased by the Company with the proceeds from Option exercises, the Shares so tendered or withheld shall not become available for issuance under the Plan.
(e) Substitute Awards shall not reduce the Shares authorized for grant under the Plan or authorized for grant to a Participant in any calendar year. Additionally, in the event that a company acquired by the Company or with which the Company combines has shares available under a pre-existing plan approved by stockholders and not adopted in contemplation of such acquisition or combination, the shares available for grant pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the Shares authorized for grant under the Plan; provided that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not Employees or Directors prior to such acquisition or combination.
(f) Notwithstanding any other provision of the Plan, the aggregate grant date fair value of all Awards made to any single Director in any calendar year shall not exceed $500,000, excluding the value of Awards made during that year at the election of the Director in lieu of all or a portion of annual Board and committee cash compensation. For the avoidance of doubt, the purpose of the final clause in the preceding sentence is to apply the $500,000 annual limitation consistently to all Directors, regardless of whether a Director has elected to acquire Awards using cash compensation otherwise payable to him or her for service as a Director.
3.2 Character of Shares. Any Shares issued under the Plan may consist, in whole or in part, of either authorized and unissued shares or treasury shares, or both, at the sole discretion of the Committee.
4.1 Administration. The Plan shall be administered by the Committee.
4.2 Authority. The Committee shall have full power and authority, subject to the provisions of the Plan and subject to such orders or resolutions not inconsistent with the provisions of the Plan as may from time to time be adopted by the Board, to: (a) select the Employees and independent contractors to whom Awards may from time to time be granted under the Plan; (b) determine the type or types of Awards, not inconsistent with the provisions of the Plan, to be granted to each Participant under the Plan; (c) determine the number of Shares to be covered by each Award granted under the Plan; (d) determine the terms and conditions, not inconsistent with the provisions of the Plan, of any Award granted under the Plan; (e) determine whether, to what extent and under what circumstances Awards may be settled in cash, Shares or other property; (f) determine whether, to what extent, and under what circumstances cash, Shares, other property and other amounts payable with respect to an Award made under the Plan shall be deferred either automatically or at the election of the Participant; (g) determine whether, to what extent and under what circumstances any Award shall be canceled or suspended; (h) interpret and administer the Plan and any instrument or agreement entered into under or in connection with the Plan, including any Award Agreement; (i) correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent that the Committee shall deem desirable to carry it into effect; (j) establish such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; (k) determine whether any Award (other than an Option or Stock Appreciation Right) will have Dividend Equivalents; and (l) make any other determination and take any other action that the Committee deems necessary or desirable for administration of the Plan. Without limiting the generality of the foregoing, the Committee shall determine whether an authorized leave of absence, or absence in military or government service, shall constitute termination of employment. Decisions of the Committee shall be final, conclusive and binding on all persons or entities, including any Participant and any Subsidiary. Any action or
determination by the Committee specifically affecting or relating to an Award to a Director shall require the prior approval of the Board.
4.3 Prohibition Against Repricing. Notwithstanding Section 4.2 or any other provision of the Plan, except for adjustments pursuant to Section 13, the Committee shall not reprice, adjust or amend the exercise price of Options or the strike price of Stock Appreciation Rights previously awarded to any Participant, whether through amendment, cancellation and replacement grant, or any other means, unless such action is approved by the stockholders of the Company. For purposes of the Plan, the term "reprice" shall mean: (a) the reduction, directly or indirectly, in the per-Share price of an outstanding Option or Stock Appreciation Right by amendment, cancellation or substitution; (b) any action that is treated as a repricing under generally accepted accounting principles; (c) canceling an Option or Stock Appreciation Right in exchange for another Option, Stock Appreciation Right or other equity security (unless the cancellation and exchange occurs in connection with a merger, acquisition, or similar transaction); and (d) any other action that is treated as a repricing by the rules or regulations of any stock exchange on which the securities of the Company are traded. In addition, notwithstanding any other provision in the Plan to the contrary, an Option or a Stock Appreciation Right may not be surrendered in consideration of or exchanged for cash, other Awards, or a new Option or a Stock Appreciation Right having an exercise price below that of the Option or a Stock Appreciation Right which was surrendered or exchanged, unless the exchange occurs in connection with an adjustment pursuant to Section 13 or a merger, acquisition, or similar transaction, or such action is approved by the stockholders of the Company. Any amendment or repeal of this Section 4.3 shall require the approval of the stockholders of the Company
4.4 Delegation. To the extent not inconsistent with applicable law, including Section 162(m) of the Code, or the rules and regulations of the NYSE (or such other principal securities market on which the Shares are traded), the Committee may delegate to (a) committee of one or more directors of the Company any of the authority of the Committee under the Plan, including the right to grant, cancel or suspend Awards and (b) to the extent permitted by law, to one or more executive officers or a committee of executive officers the right to grant Awards to persons who are not executive officers (within the meaning of Rule 16a-1 under the Exchange Act) of the Company, subject to such restrictions and limitation as the Committee may specify. In no event, however, may the Committee delegate to another Board committee, one or more executive officers, or a committee of executive officers the authority to take any action or make any determination specifically affecting or relating to an Award to a Director.
4.5 Liability. No member of the Committee shall be liable for any action, omission, or determination relating to the Plan, and Ameriprise Financial shall indemnify and hold harmless each member of the Committee and each other director or employee of the Company to whom any duty or power relating to the administration or interpretation of the Plan has been delegated against any cost or expense (including counsel fees) or liability (including any sum paid in settlement of a claim with the approval of the Committee) arising out of any action, omission or determination relating to the Plan, unless, in either case, such action, omission or determination was taken or made by such member, director or employee in bad faith and without reasonable belief that it was in the best interests of the Company.
5.1 Eligible Participants. Any Employee, Director or independent contractor of the Company shall be eligible to be selected as a Participant and to receive Awards pursuant to the Plan.
5.2 Foreign Employees. Awards may be granted to Participants who are foreign nationals or employed outside the United States, or both, on such terms and conditions different from those applicable to Awards to Employees employed in the United States as may, in the judgment of the Committee, be necessary or desirable in order to recognize differences in local law or tax policy. The Committee also
may impose conditions on the exercise or vesting of Awards in order to minimize the Company's obligation with respect to tax equalization for Employees on assignments outside their home country.
6.1 Grant. Options may be granted under the Plan to Participants either alone or in addition to other Awards granted under the Plan.
6.2 Exercise Price. Other than in connection with Substitute Awards, the exercise price per each Share purchasable under any Option shall not be less than 100 percent of the Fair Market Value of a Share on the date of grant of such Option.
6.3 Term. The term of each Option shall be fixed by the Committee in its sole discretion; provided that no Option shall be exercisable after the expiration of ten years from the date the Option is granted, except in the event of death or disability. Except for Substitute Awards, Options granted to a person newly hired or retained to perform services for the Company, Options granted in connection with the promotion of an Employee, or the death, disability, retirement or other termination of a Participant, or the occurrence of a corporate transaction (including, but not limited to, a Change in Control), Options may not be exercisable before the expiration of one year from the date the Option is granted.
6.4 Exercise.
(a) Vested Options granted under the Plan shall be exercised by the Participant as to all or part of the Shares covered thereby, by giving notice of exercise to the Company or its designated agent, specifying the number of Shares to be purchased. The notice of exercise shall be in such form, made in such manner, and in compliance with such other requirements consistent with the provisions of the Plan as the Committee may prescribe from time to time.
(b) Unless otherwise provided in an Award Agreement, full payment of such exercise price shall be made at the time of exercise and shall be made (i) in cash or cash equivalents (including certified check or bank check or wire transfer of immediately available funds), (ii) by tendering previously acquired Shares (either actually or by attestation, valued at their then Fair Market Value), (iii) with the consent of the Committee, by authorizing a third party to sell, on behalf of the Participant, the appropriate number of Shares otherwise issuable to the Participant upon the exercise of the Option and to remit to the Company a sufficient portion of the sale proceeds to pay the entire exercise price and the minimum statutory tax withholding resulting from such exercise, (iv) with the consent of the Committee, by withholding Shares otherwise issuable in connection with the exercise of the Option, (v) through any other method specified in an Award Agreement, or (vi) any combination of any of the foregoing. In no event may any Option granted under the Plan be exercised for a fraction of a Share. No adjustment shall be made for cash dividends or other rights for which the record date is prior to the date of such issuance.
6.5 Incentive Stock Options. The Committee may grant Options intended to qualify as "incentive stock options" as defined in Section 422 of the Code, to any Employee, subject to the requirements of Section 422 of the Code. The Award Agreement evidencing the award of an "incentive stock option" shall clearly identify such Option as an "incentive stock option" within the meaning of Section 422 of the Code. Solely for purposes of determining whether Shares are available for the grant of "incentive stock options" under the Plan, the maximum aggregate number of Shares that may be issued pursuant to "incentive stock options" granted under the Plan shall be the total number of Shares authorized for issuance under the Section 3.1(a) of the Plan (but without regard to the operation of Section 3.1(c)), subject to adjustments provided in Section 13.
7.1 Grant. Stock Appreciation Rights may be granted under the Plan to Participants (a) in conjunction with all or part of any Option granted under the Plan or at any subsequent time during the term of such Option, (b) in conjunction with all or part of any Award (other than an Option) granted under the Plan or at any subsequent time during the term of such Award, or (c) without regard to any Option or other Award in each case upon such terms and conditions as the Committee may establish in its sole discretion.
7.2 Strike Price. Other than in connection with Substitute Awards, the per-Share strike price under any Stock Appreciation Right shall not be less than 100 percent of the Fair Market Value of a Share on the date of grant of such Stock Appreciation Right (subject to the requirements of Section 409A of the Code with respect to a Stock Appreciation Right granted in conjunction with, but subsequent to, an Option).
7.3 Term. The term of each Stock Appreciation Right shall be fixed by the Committee in its sole discretion; provided that no Stock Appreciation Right shall be exercisable after the expiration of ten years from the date the Stock Appreciation Right is granted, except in the event of death or disability. Except for Substitute Awards, Stock Appreciation Rights granted to a person newly hired or retained to perform services for the Company, Stock Appreciation Rights granted in connection with the promotion of an Employee, or the death, disability, retirement or other termination of a Participant, or the occurrence of a corporate transaction (including, but not limited to, a Change in Control), Stock Appreciation Rights may not be exercisable before the expiration of one year from the date the Option is granted. The Committee may impose such terms and conditions on Stock Appreciation Rights granted in conjunction with any Award (other than an Option) as the Committee shall determine in its sole discretion.
7.4 Exercise.
(a) Vested Stock Appreciation Rights granted under the Plan shall be exercised by the Participant as to all or part of the Shares covered thereby, by giving notice of exercise to the Company or its designated agent, specifying the number of Shares covered thereby to which the Stock Appreciation Right is exercised. The notice of exercise shall be in such form, made in such manner, and in compliance with such other requirements consistent with the provisions of the Plan as the Committee may prescribe from time to time. In no event may any Stock Appreciation Right granted under the Plan be exercised for a fraction of a Share.
(b) Upon the exercise of a Stock Appreciation Right, the holder shall have the right to receive the excess of (i) the Fair Market Value of one Share on the date of exercise over (ii) the strike price of the Stock Appreciation Right. The Committee shall determine in its sole discretion whether payment shall be made in cash, in whole Shares or other property, or any combination thereof.
8. Restricted Stock, Restricted Stock Units and Other Share-Based Awards
8.1 Grant. Awards of Restricted Stock and of Restricted Stock Units and Other Share-Based Awards may be granted under the Plan to Participants either alone or in addition to other Awards granted under the Plan, and such Awards of Restricted Stock and Restricted Stock Units and Other Share-Based Awards shall also be available as a form of payment of Performance Awards and other earned cash-based incentive compensation. An Award of Restricted Stock or Restricted Stock Units or Other Share-Based Awards shall be subject to vesting restrictions imposed by the Committee covering the Vesting Period. The Committee has absolute discretion to determine whether any consideration (other than services) is to be received by the Company as a condition precedent to the issuance of Restricted Stock, Restricted Stock Units or Other Share-Based Award.
8.2 Term. Except for Substitute Awards, Awards of Restricted Stock or Restricted Stock Units or Other Share-Based Awards granted to a person newly hired or retained to perform services for the Company, Awards of Restricted Stock or Restricted Stock Units or Other Share-Based Awards granted in connection with the promotion of an Employee, or the death, disability, retirement or other termination of a Participant, or the occurrence of a corporate transaction (including, but not limited to, a Change in Control), or special circumstances determined by the Committee, such as the achievement of performance objectives (which shall have a minimum Vesting Period of one year), Awards of Restricted Stock and Restricted Stock Units and Other Share-Based Awards subject solely to the continued employment of Employees shall have a Vesting Period of not less than three years from the date of grant (but permitting pro rata vesting over such time); provided that such restrictions shall not be applicable to (a) grants to new hires to replace forfeited awards from a prior employer, (b) grants of Awards of Restricted Stock or Restricted Stock Units or Other Share-Based Awards in payment of Performance Awards and other earned cash-based incentive compensation, (c) Awards of Restricted Stock or Restricted Stock Units or Other Share-Based Awards granted as Payment Shares, or (d) grants not in excess of five percent of the number of shares available for Awards under Section 3.1(a). Subject to the foregoing minimum Vesting Period requirements, the Committee may, in its sole discretion and subject to the limitations imposed under Section 162(m) of the Code in the case of an Award of Restricted Stock or Restricted Stock Units or Other Share-Based Award intended to comply with the performance-based exception under Code Section 162(m), waive the forfeiture period and any other conditions set forth in any Award Agreement subject to such terms and conditions as the Committee shall deem appropriate. The minimum Vesting Period requirements of this Section shall not apply to Awards of Restricted Stock or Restricted Stock Units or Other Share-Based Awards granted to Directors or any consultant or advisor who provides services to the Company.
8.3 Rights of Holders. Unless otherwise provided in the Award Agreement, beginning on the date of grant of an Award of Restricted Stock, the Participant shall become a stockholder of the Company with respect to all Shares subject to the Award and shall have all of the rights of a stockholder, including the right to vote such Shares and the right to receive distributions made with respect to such Shares. A Participant receiving an Award of Restricted Stock Units or Other Share-Based Award shall not possess voting rights with respect to such Award. Except as otherwise provided in an Award Agreement, any Shares or any other property (other than cash) distributed as a dividend or otherwise with respect to any Award of Restricted Stock or Restricted Stock Units or Other Share-Based Award as to which the restrictions have not yet lapsed shall be subject to the same restrictions as such Award of Restricted Stock or Restricted Stock Units or Other Share-Based Award.
8.4 Payment. Except as may be provided in an Award Agreement, Other Share-Based Awards may be paid in cash, Shares, other property, or any combination thereof, in the sole discretion of the Committee. Other Share-Based Awards may be paid in a lump sum or in installments or, in accordance with procedures established by the Committee, on a deferred basis subject to the requirements of Section 409A of the Code.
9.1 Grant. Performance Awards may be granted under the Plan to Participants, for no consideration or for such minimum consideration as may be required by applicable law, either alone or in addition to other Awards granted under the Plan.
9.2 Terms and Conditions. The performance criteria to be achieved during any Performance Period and the length of the Performance Period shall be determined by the Committee upon the grant of each Performance Award; provided, however, that a Performance Period shall not be shorter than one year. The performance goals to be achieved for each Performance Period shall be conclusively determined by
the Committee and may be based upon the criteria set forth in Section 10.2. Dividends or Dividend Equivalents accruing on Performance Awards shall not be paid until and only to the extent that the Performance Award is earned.
9.3 Payment. Except as may otherwise be provided in an Award Agreement, Performance Awards will be paid only after the end of the relevant Performance Period. The amount of the Award to be paid shall be conclusively determined by the Committee. Performance Awards may be paid in cash, Shares, other property, or any combination thereof, in the sole discretion of the Committee. Performance Awards may be paid in a lump sum or in installments following the close of the Performance Period or, in accordance with procedures established by the Committee, on a deferred basis subject to the requirements of Section 409A of the Code.
10.1 Grant. Notwithstanding any other provision of the Plan, if the Committee determines at the time an Award of Restricted Stock or Restricted Stock Units, a Performance Award or an Other Share-Based Award is granted to a Participant who is, or is likely to be, as of the end of the tax year in which the Company would claim a tax deduction in connection with such Award, a Covered Employee, then the Committee may provide that this Section 10 is applicable to such Award.
10.2 Performance Criteria. If the Committee determines that an Award of Restricted Stock or Restricted Stock Units, a Performance Award or an Other Share-Based Award is intended to be subject to this Section 10, the lapsing of restrictions thereon and the payment of cash, Shares or other property pursuant thereto, as applicable, shall be subject to the achievement of one or more objective performance goals established by the Committee, which shall be based on the attainment of specified levels of one or any combination of the following: (a) net income or operating net income (before or after taxes, interest, depreciation, amortization or nonrecurring or unusual items); (b) return on assets, return on capital, return on equity, return on economic capital, return on other measures of capital, return on sales or other financial criteria; (c) revenue or net sales; (d) gross profit or operating gross profit; (e) cash flow; (f) productivity or efficiency ratios; (g) share price or total shareholder return; (h) earnings per share; (i) budget and expense management; (j) customer and product measures, including market share, high value client growth, and customer growth; (k) working capital turnover and targets; (l) margins; and (m) economic value added or other value added measurements, in any such case (i) considered absolutely or relative to historic performance or relative to one or more other businesses and (ii) determined for the Company or any business unit or division thereof. The measurement of any performance goal may exclude the impact of charges for restructurings, discontinued operations, extraordinary items, and other unusual or non-recurring items, and the cumulative effects of accounting changes, each as defined by generally accepted accounting principles and as identified in the Company's audited financial statements, including the notes thereto. Any performance goal may be used to measure the performance of Ameriprise Financial or a Subsidiary as a whole or any business unit of Ameriprise Financial or any Subsidiary, or any combination thereof, as the Committee may deem appropriate, or any of the above performance goals as compared to the performance of a group of comparator companies, or a published or special index that the Committee, in its sole discretion, deems appropriate. Such performance goals shall be set by the Committee within the time period prescribed by, and shall otherwise comply with the requirements of Section 162(m) of the Code.
10.3 Individual Award Limits. Subject to adjustment as provided in Section 13 and excluding Substitute Awards, the maximum number of Shares that may be covered by Stock Options or Stock Appreciation Rights granted under the Plan to any single Participant in any calendar year shall not exceed 3 million shares. The amount payable to any Participant with respect to any calendar year for all Awards other than Stock Options and Stock Appreciation Rights shall not exceed $30 million. For purposes of
the foregoing sentence, the calendar year or years in which amounts under Awards are deemed paid or received shall be as determined by the Committee, and Awards shall be valued against the $30 million limit as follows: (a) an Award denominated in dollars shall have a value equal to the amount paid under the Award; and (b) an Award denominated in Shares shall have a value equal to the product of the number of Shares subject to the Award multiplied by the Fair Market Value of a Share on the date of grant.
10.4 Discretionary Reduction. The amount payable with respect to an Award that is subject to the provisions of this Section 10 shall be determined in any manner permitted by Section 162(m) of the Code. The Committee may, in its discretion, reduce or eliminate the amount payable to any Participant with respect to an Award that is subject to the provisions of this Section 10, based on such factors as the Committee may deem relevant, but the Committee may not increase any such amount above the amount established in accordance with the relevant performance goals. For purposes of clarity, the Committee may exercise the discretion provided for by the foregoing sentence in a non-uniform manner among Participants.
10.5 Restrictions. The Committee shall have the power to impose such other restrictions on Awards subject to this Section 10 as it may deem necessary or appropriate to ensure that such Awards satisfy all requirements for "performance-based compensation" within the meaning of Section 162(m) of the Code.
11. Generally Applicable Award Provisions
11.1 Award Agreement. Each Award granted under the Plan shall be evidenced by an Award Agreement in such form and containing such terms and conditions as the Committee shall determine which are not inconsistent with the provisions of the Plan.
11.2 Award Terms May Vary by Participant. The terms of Awards need not be the same with respect to each Participant.
11.3 No Obligation to Exercise. The grant of an Award to a Participant under the Plan shall impose no obligation upon such Participant to exercise such Award.
11.4 No Right to Continued Employment or Service. Nothing contained in the Plan or any Award shall confer upon any Participant any right with respect to the continuation of his employment by or service to the Company or interfere in any way with the right of the Company at any time to terminate such employment or service or to increase or decrease the compensation of the Participant from the rate in existence at the time of the grant of an Award.
11.5 Nontransferability. Awards granted under the Plan may not be sold, pledged, hypothecated, assigned, margined or otherwise transferred in any manner other than by will or the laws of descent and distribution, unless and until the Shares underlying such Award have been issued, and all restrictions applicable to such Shares have lapsed or have otherwise been waived by the Committee. No Award or interest or right therein shall be subject to the debts, contracts or engagements of a Participant or his or her successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law, by judgment, lien, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy and divorce), and any attempted disposition thereof shall be null and void, of no effect, and not binding on the Company in any way.
11.6 Termination of Employment. The Committee shall determine and set forth in each Award Agreement whether any Awards granted in such Award Agreement will continue to be exercisable, and the terms of such exercise, on and after the date that a Participant ceases to be employed by or to
provide services to the Company (including as a Director), whether by reason of death, disability, voluntary or involuntary termination of employment or services, or otherwise. The date of termination of a Participant's employment or services will be determined by the Committee, which determination will be final.
11.7 Dividend Equivalents. Subject to the provisions of the Plan and any Award Agreement, the recipient of an Award (other than an Option or Stock Appreciation Right) may, if so determined by the Committee, be entitled to receive, currently or on a deferred basis, cash, stock or other property dividends, or cash payments in amounts equivalent to cash, stock or other property dividends on Shares ("Dividend Equivalents") with respect to the number of Shares covered by the Award, as determined by the Committee, in its sole discretion. The Committee may provide that such amounts and Dividend Equivalents (if any) shall be deemed to have been reinvested in additional Shares or otherwise reinvested and may provide that such amounts and Dividend Equivalents are subject to the same vesting or performance conditions as the underlying Award. In no event, however, shall dividends or Dividend Equivalents be paid to any recipient of a Performance Award or other Award subject to performance conditions until and only to the extent that the Award is earned.
11.8 Tax Withholding. The Company shall have the right to make all payments or distributions pursuant to the Plan to a Participant net of any applicable federal, state and local taxes required to be paid or withheld as a result of (a) the grant of any Award, (b) the exercise of an Option or Stock Appreciation Right, (c) the delivery of Shares or cash, (d) the lapse of any restrictions in connection with any Award or (e) any other event occurring pursuant to the Plan. The Company shall have the right to withhold from wages or other amounts otherwise payable to such Participant such withholding taxes as may be required by law, or to otherwise require the Participant to pay such withholding taxes. If the Participant shall fail to make such tax payments as are required, the Company shall, to the extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to such Participant or to take such other action as may be necessary to satisfy such withholding obligations. The Committee shall be authorized to establish procedures for election by Participants to satisfy such obligation for the payment of such taxes by tendering previously acquired Shares (either actually or by attestation, valued at their then Fair Market Value), or by directing the Company to retain Shares (up to the Participant's minimum required tax withholding rate or such other rate that will not trigger a negative accounting impact) otherwise deliverable in connection with the Award.
11.9 Recoupment of Incentive Compensation. Notwithstanding any other provisions in the Plan, any Award which is subject to recovery under any law, government regulation, stock exchange listing requirement or recoupment policy adopted by the Company will be subject to such deductions and clawback as may be required to be made pursuant to such law, government regulation, stock exchange listing requirement or recoupment policy adopted by the Company (including a policy adopted by the Company in response to any such law, government regulation or stock exchange listing requirement).
11.10 Automatic Exercise. The Committee, in its sole discretion, may provide in an Award Agreement or otherwise that any Option or Stock Appreciation Right outstanding on the last business day of the term of such Option or Stock Appreciation Right with an exercise or strike price per Share that is less than the Fair Market Value of a Share as of such date shall automatically and without further action by the Participant (or, in the event of Participant's death, Participant's personal representative or estate) or the Company be exercised on the last business day of the term of such Option or Stock Appreciation Right if the Committee, in its sole discretion, determines that such exercise would provide economic benefit to the Participant after payment of the exercise price, applicable taxes and any expenses to effect the exercise. In the sole discretion of the Committee, payment of the exercise price of any Option may be made pursuant to Section 6.4(b)(iii) or (iv), and the Company may deduct or withhold an amount sufficient to satisfy all taxes associated with such exercise in accordance with Section 11.8. Unless otherwise determined by the Committee, this Section shall not apply to an Option if the Participant of
such Option incurs a termination of employment or service on or before the last business day of the term of such Option or Stock Appreciation Right.
11.11 Data Protection. By participating in the Plan, a Participant consents to the collection, processing, transmission and storage by the Company in any form whatsoever, of any data of a professional or personal nature which is necessary for the purposes of administering the Plan. The Company may share such information with any Subsidiary, trustees, brokers, other third-party administrator or any Person who obtains control of the Company or acquires the Company or a Subsidiary which employs the Participant.
12.1 For purposes of the Plan and any Award Agreement, "Change in Control" means the occurrence of any of the following:
(a) any Person becoming the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act, a "Beneficial Owner") of 25 percent or more of the combined voting power of Voting Securities; provided, however that a Change in Control shall not be deemed to occur by reason of an acquisition of Voting Securities by the Company or by an employee benefit plan (or a trust forming a part thereof) maintained by the Company; and provided, further that a Change in Control shall not be deemed to occur solely because any Person becomes the Beneficial Owner of 25 percent or more of the outstanding Voting Securities as a result of the acquisition of Voting Securities by the Company which, by reducing the number of Voting Securities deemed to be outstanding, increases the proportional number of shares Beneficially Owned by such Person, except that a Change in Control shall occur if a Change in Control would have occurred (but for the operation of this proviso) as a result of the acquisition of Voting Securities by the Company, and after such acquisition such Person becomes the Beneficial Owner of any additional Voting Securities following which such Person is the Beneficial Owner of 25 percent or more of the outstanding Voting Securities;
(b) the individuals who, as of April 30, 2014, are members of the Board (the "Incumbent Board"), cease for any reason to constitute at least a majority of the members of the Board; provided, however that if the election or appointment, or nomination for election by Ameriprise Financial's common stockholders, of any new director was approved by a vote of at least two-thirds of the Incumbent Board, such new director shall, for purposes of the Plan, thereafter be considered as a member of the Incumbent Board; provided further, however, that no individual shall be considered a member of the Incumbent Board if such individual initially assumed office as a result of an actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board (a "Proxy Contest") including by reason of any agreement intended to avoid or settle any Proxy Contest; or
(c) the consummation of:
(i) a merger, consolidation, reorganization or similar transaction (any of the foregoing, a "Business Combination") with or into Ameriprise Financial or in which securities of Ameriprise Financial are issued, unless such Business Combination is a Non-Control Transaction;
(ii) a complete liquidation or dissolution of the Company; or
(iii) the sale or other disposition of all or substantially all of the assets of the Company (on a consolidated basis) to any Person other than the Company or an employee benefit plan (or a trust forming a part thereof) maintained by the Company or by a Person which, immediately
thereafter, will have all its voting securities owned by the holders of the Voting Securities immediately prior thereto, in substantially the same proportions.
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur as a result of any event or transaction to the extent that treating such event or transaction as a Change in Control would cause any tax to become due under Section 409A of the Code.
12.2 "Non-Control Transaction" means a Business Combination involving Ameriprise Financial where:
(a) the holders of Voting Securities immediately before such Business Combination own, directly or indirectly immediately following such Business Combination more than fifty percent of the combined voting power of the outstanding voting securities of the parent corporation resulting from, or issuing its voting securities as part of, such Business Combination (the "Surviving Corporation") in substantially the same proportion as their ownership of votes that the Voting Securities immediately before such Business Combination by reason of their prior ownership of Voting Securities;
(b) the individualstrustee receives from other Plan participants who were members of the Incumbent Board immediately priordid vote. Continued and to the execution of the agreement providing for such Business Combination constitute a majority of the members of the board of directors of the Surviving Corporation, or a corporation beneficially owning a majority of the voting securities of the Surviving Corporation; and
(c) no Person other than the Company or any employee benefit plan (or any trust forming a part thereof) maintained immediately prior to such Business Combination by the Company, is a Beneficial Owner of 25 percent or more of the combined voting power of the Surviving Corporation's voting securities outstanding immediately following such Business Combination.
12.3 Change in Control. The Committee may determine and set forth in each Award Agreement the effect of a Change in Controlbe signed on such Award.reverse side V.1.1
In the event of any change in the outstanding Shares by reason of any stock split, stock dividend, split-up, split-off, spin-off, recapitalization, merger, consolidation, rights offering, reorganization, combination, subdivision or exchange of shares, a sale by Ameriprise Financial of all or part of its assets, any distribution to stockholders other than a normal cash dividend, or other extraordinary or unusual event, the Committee shall make such adjustment in: (a) the class and aggregate number of shares that may be delivered under the Plan as described in Section 3.1(a); (b) the class and aggregate number of shares that may be delivered under the Plan as Awards other than Options or Stock Appreciation Rights described in Section 3.1(a); (c) the class and aggregate number of shares that may be delivered under the Plan as "incentive stock options" as described in Section 6.5; (d) the class, number and exercise/strike price of outstanding Options and Stock Appreciation Rights; and (e) the class and number of shares subject to any other Awards granted under the Plan (provided that the number of shares of any class subject to Awards shall always be a whole number), as may be determined to be appropriate by the Committee, and such adjustments shall be final, conclusive and binding for all purposes of the Plan; provided, however, that no such adjustment shall be made if and to the extent that the making of such adjustment would cause Options, Stock Appreciation Rights or qualifying awards granted under Section 10 to fail to qualify as "performance-based compensation" under Section 162(m) of the Code. With respect to Awards subject to Section 409A of the Code, any adjustments or substitutions under this Section 13 shall conform to the requirements of Section 409A of the Code.
14.1 Board Authority to Amend or Terminate the Plan. The Board may, from time to time, alter, amend, suspend or terminate the Plan as it shall deem advisable, subject to any requirement for
stockholder approval imposed by applicable law, including the rules and regulations of the principal securities market on which the Shares are traded; provided that the Board may not amend the Plan in any manner that would result in noncompliance with Rule 16b-3 of the Exchange Act; and further provided that the Board may not, without the approval of the Company's stockholders amend the Plan to (a) increase the number of Shares that may be the subject of Awards under the Plan (except for adjustments pursuant to Section 13), (b) expand the types of Awards available under the Plan, (c) materially expand the class of persons eligible to participate in the Plan, (d) amend any provision of Section 4.3, 6.2 or 7.2, (e) increase the maximum permissible term of any Option specified by Section 6.3 or the maximum permissible term of a Stock Appreciation Right specified by Section 7.3, or (f) amend any provision of Section 10.3. Nothing in the Plan shall limit the right of the Company to pay compensation of any kind outside the terms of the Plan.
14.2 Effect of Amendment or Termination on Outstanding Awards. Except as expressly provided in the Plan, no action under Section 14.1 may, without the consent of a Participant, reduce in any material respect the Participant's rights under any previously granted and outstanding Award.
14.3 Savings Clause. No provision of this Section 14 shall be given effect to the extent that such provision would cause any tax to become due under Section 409A of the Code.
15.1 No Right to Awards. No person shall have any claim or right to receive an Award under the Plan. The Committee's granting of an Award to a Participant at any time shall neither require the Committee to grant an Award to such Participant or any other Participant or other person at any time nor preclude the Committee from making subsequent grants to such Participant or any other Participant or other person.
15.2 Rights as a Stockholder. Unless the Committee determines otherwise, a Participant shall not have any rights as a stockholder with respect to Shares covered by an Award until the date the Participant becomes the holder of record with respect to such Shares. No adjustment will be made for dividends or other rights for which the record date is prior to such date, except as provided in Section 11.7.
15.3 Unfunded Plan. Unless otherwise determined by the Committee, the Plan shall be unfunded and shall not create (or be construed to create) a trust or a separate fund or funds. The Plan shall not establish any fiduciary relationship between the Company and any Participant or other person. To the extent any Participant holds any rights by virtue of an Award granted under the Plan, such rights shall constitute general unsecured liabilities of the Company and shall not confer upon any Participant or any other person or entity any right, title, or interest in any assets of the Company.
15.4 Compliance with Section 409A of the Code. This Plan is intended to comply and shall be administered in a manner that is intended to comply with Section 409A of the Code and shall be construed and interpreted in accordance with such intent. To the extent that an Award or the payment, settlement or deferral thereof is subject to Section 409A of the Code, the Award shall be granted, paid, settled or deferred in a manner that will comply with Section 409A of the Code, including regulations or other guidance issued with respect thereto, except as otherwise determined by the Committee. Any provision of this Plan that would cause the grant of an Award or the payment, settlement or deferral thereof to fail to satisfy Section 409A of the Code shall be amended to comply with Section 409A of the Code on a timely basis, which may be made on a retroactive basis, in accordance with regulations and other guidance issued under Section 409A of the Code.
15.5 Expenses and Receipts. The expenses of the Plan shall be paid by Ameriprise Financial. Any proceeds received by Ameriprise Financial in connection with any Award will be used for general corporate purposes.
15.6 Captions. The captions in the Plan are for convenience of reference only, and are not intended to narrow, limit or affect the substance or interpretation of the provisions contained herein.
15.7 Severability. If any provision of the Plan shall be held unlawful or otherwise invalid or unenforceable in whole or in part by a court of competent jurisdiction, such provision shall (a) be deemed limited to the extent that such court of competent jurisdiction deems it lawful, valid and/or enforceable and as so limited shall remain in full force and effect, and (b) not affect any other provision of the Plan or part thereof, each of which shall remain in full force and effect. If the making of any payment or the provision of any other benefit required under the Plan shall be held unlawful or otherwise invalid or unenforceable by a court of competent jurisdiction, such unlawfulness, invalidity or unenforceability shall not prevent any other payment or benefit from being made or provided under the Plan, and if the making of any payment in full or the provision of any other benefit required under the Plan in full would be unlawful or otherwise invalid or unenforceable, then such unlawfulness, invalidity or unenforceability shall not prevent such payment or benefit from being made or provided in part, to the extent that it would not be unlawful, invalid or unenforceable, and the maximum payment or benefit that would not be unlawful, invalid or unenforceable shall be made or provided under the Plan.
15.8 Governing Law. The Plan and the rights of all persons under the Plan shall be construed and administered in accordance with the laws of the State of New York, without regard to its conflict of law principles. All Participants agree to submit to the jurisdiction of the state and federal courts of Minnesota with respect to matters relating to the Plan and agree not to raise or assert the defense that such forum is not convenient for such Participant.
15.9 Arbitration. Any dispute, claim or controversy that may arise between a Participant and the Company or any other person (the "Claims") under the Plan is subject to arbitration, unless otherwise agreed to in writing by the Participant and the Company. The Claims shall be finally decided by arbitration conducted pursuant to the Commercial Dispute Resolution Procedures of the American Arbitration Association (the "AAA"), and its Supplementary Rules for Securities Arbitration, or other applicable rules promulgated by the AAA. In addition, all claims, statutory or otherwise, which allege discrimination or other violation of employment laws, including but not limited to claims of sexual harassment, shall be finally decided by arbitration pursuant to the AAA unless otherwise agreed to in writing by a Participant and the Company. By agreement of a Participant and the Company in writing, disputes may be resolved in arbitration by a mutually agreed-upon organization other than the AAA. In consideration of the promises and the compensation provided in this Plan, neither a Participant nor the Company shall have a right: (a) to arbitrate a Claim on a class action basis or in a purported representative capacity on behalf of any Participants, employees, applicants or other persons similarly situated; (b) to join or to consolidate in an arbitration Claims brought by or against another Participant, employee, applicant or the Participant, unless otherwise agreed to in writing by the Participant and the Company; (c) to litigate any Claims in court or to have a jury trial on any Claims; and (d) to participate in a representative capacity or as a member of any class of claimants in an action in a court of law pertaining to any Claims. Either a Participant or the Company may compel arbitration of any Claims filed in a court of law. In addition, either a Participant or the Company may apply to a court of law for an injunction to enforce the terms of the Plan pending a final decision on the merits by an arbitration panel pursuant to this provision. The Company shall pay all fees, costs or other charges charged by the AAA or any other organization administering arbitration proceeding agreed upon pursuant to this Section 15.9 that are above and beyond the filing fees of the federal or state court in the jurisdiction in which the dispute arises, whichever is less. A Participant or the Company shall each be responsible for their own costs of legal representation, if any, except where such costs of legal representation may be awarded as a statutory remedy by the arbitrator. Any award by an arbitration panel shall be final and binding upon a Participant or the Company. Judgment upon the award may be entered by any court having jurisdiction thereof or
having jurisdiction over the relevant party or its assets. This provision is covered and enforceable under the terms of the Federal Arbitration Act.
15.10 Effective Date and Term of Plan. The Plan was originally adopted by the Board on September 30, 2005, subject to the approval of the Plan by the stockholders of Ameriprise Financial. The Plan was most recently amended and restated by the Board on February 25, 2014, subject to the approval of the Plan by the stockholders of Ameriprise Financial. No grants of Awards may be made under the Plan after February 25, 2024.
* * * * * *
|
|
|
|
|
|